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Toshiba Surges on Report of Bids at $22 Billion Valuation

Signage for Toshiba Corp. displayed at the company's headquarters in Tokyo, Japan, on Wednesday, April 7, 2021. Toshiba surged its daily limit of 18% after confirming it received an initial buyout offer from CVC Capital Partners, setting the stage for potentially the largest private equity-led acquisition in years. Photographer: Kiyoshi Ota/Bloomberg (Bloomberg)

Toshiba Corp. shares jumped as much as 6.5% on Thursday after Reuters reported bidders are considering offering up to 7,000 yen per share to take the company private, which would value the deal at about $22 billion.

Toshiba has been soliciting acquisition offers -- and other restructuring proposals -- as it seeks to end years of mismanagement and mollify activist investors. Ten offers are on the table, including eight to take the company private. The range of pricing and conditions for privatization was widespread, the report said, citing people familiar with the situation.

“That suggests that some assets would need to be carved out, or spun out - like Kioxia - and if spun out, that would mean a lower price for the rest of the basket,” analyst Travis Lundy wrote in a note on Smartkarma. There is still a long way to go and the price could well be lowered in the second round of bidding, he added.

The tech conglomerate’s Tokyo-listed stock closed at 5,501 yen the day prior.

Bain Capital, Blackstone Inc. and CVC Capital Partners are among the funds considering bids, Bloomberg News has reported. A successful deal, which may be private equity’s largest ever in the country, would signal that the once-criticized class of investors is becoming more accepted in Japan.

Private Equity Giants Called Vultures Eye Breakthrough in Japan

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