Due to an unforeseen turn of events, a news conference about the $18 Billion deal between Toshiba Inc. and Bain group was canceled moments before it began.
Yuji Sugimoto, the head of Bain capital in Japan clarified the details about the cancellation saying that the consortium, consisting of Apple Inc., Dell and SK Hynix, was unable to come to a conclusion on whether to brief the media or not.
Other than Apple, Dell and SK Hynix, Bain’s consortium includes Seagate Technology Plc and Kingston Technology and three other companies.
Deal not Cancelled
He denied the rumors about the deal being canceled and said that the disagreement was on the briefing, not the deal. However, he remained silent on stating the names of the members that disagreed.
Sources close to the deal revealed that when the parties came to an agreement, the signing was delayed because Apple made a new demand. Cupertino wanted to have new terms regarding the chip supply.
According to Hideki Yasuda of Ace Research Institute,
This consortium has so many members that it is going to be hard to come to a consensus and agree on who’s going to take the initiative.
Yasuda remarked that the completing the deal successfully would be a sigh of relief for Toshiba. It would help the giant avoid rougher waters.
Continuing Troubles for Toshiba
Toshiba already ended last year with a negative net worth and if this deal doesn’t happen it will end another year in negative numbers as well. This will, in turn, highly pressurize the Tokyo stock exchange.
This isn’t the only problem faced by Toshiba. Western Digital, Toshiba’s chip venture partner and rejected suitor, is also trying to stop the company from participating in the deal with an injunction. Last year, Western Digital paid $16 billion to buy SanDisk, a company partially owned by Toshiba.
They don’t like the fact that Toshiba is going ahead with the agreement without their consent. Western Digital obviously doesn’t want its NAND business to go into its competitors’ hands.