TOKYO (Reuters) – Toshiba Corp announced on Wednesday that it expects its tender offer to take the company private to be successful. The Japanese conglomerate has been facing pressure from activist investors to restructure its business and increase shareholder value.
Toshiba’s decision to go private comes after a contentious battle with foreign funds. The company has been the target of various hedge funds, including Farallon Capital Management and Third Point, who have been pressuring the management to improve corporate governance and enhance shareholder returns.
The tender offer is part of Toshiba’s restructuring plan, which includes spinning off its profitable memory chip unit to raise capital. The company aims to shift its focus towards its core businesses, such as industrial infrastructure and energy systems, in order to improve profitability and regain investor confidence.
Toshiba has faced several setbacks in recent years, including an accounting scandal in 2015 that led to the resignation of its CEO and a major loss in its nuclear business. The company has been struggling to recover from these challenges and is now seeking to reposition itself to ensure its long-term survival and growth.
The decision to go private will provide Toshiba with more flexibility and autonomy in decision-making. It will also allow the company to avoid public scrutiny and pressure from short-term shareholders, enabling management to focus on implementing its strategic plans.
However, some analysts are skeptical about the success of Toshiba’s privatization plan. They argue that the company needs to address its governance issues and improve transparency to regain investor trust. Furthermore, the company will need to demonstrate its ability to generate sustainable profits and deliver shareholder value in order to win over skeptical investors.
The tender offer is currently ongoing, and the success of the privatization plan will depend on the response from shareholders. Toshiba hopes that the offer will be well-received and that it can successfully execute its restructuring plan to strengthen its financial position and competitiveness in the market.
Despite the challenges, Toshiba remains optimistic about its future prospects. The company believes that by focusing on its core businesses and streamlining operations, it can overcome its current difficulties and emerge as a stronger and more resilient company.
As the tender offer progresses, all eyes will be on Toshiba to see if the company can deliver on its promises and restore investor confidence in its ability to drive sustainable growth and create long-term value.
Reporting by Tokyo Newsroom, Editing by Louise Heavens
Credit: The Star : Tech Feed
