Toshiba buyout price tag adds another AGM twist

2 minute read

The logo of Toshiba Corp. is seen at the company's facility in Kawasaki, Japan February 13, 2017. REUTERS/Issei Kato/

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MELBOURNE, June 23 (Reuters Breakingviews) - After seven years of scandal and upheaval, Japanese conglomerate Toshiba (6502.T) was supposed to lay the final groundwork for a sale at next week’s annual shareholders’ meeting. Instead, fresh controversy read more over adding two directors has been followed by a Reuters report read more that bidders are considering a $22 billion buyout. It could swing the outcome.

A 7,000 yen a share price tag would be 17% higher than the number mooted by Elliott Management last year. It’s more than 10 times the EBITDA Toshiba is expected to generate in the year to March 2023, per estimates on Refinitiv, but may be adjusted after factoring in businesses Tokyo doesn’t want private equity firms such as Bain or KKR (KKR.N) to own.

It gives investors more to chew on before they vote for board nominees from Elliott and Farallon Capital, who want to keep watch over corporate governance around the sale process. After the board backed the candidates, however, outside director Mariko Watahiki publicly expressed her dissent. It casts doubt on the ballot and suggests that Toshiba will again do things the hard way. (By Jeffrey Goldfarb)

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Editing by Una Galani and Thomas Shum

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