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4-Traders Homepage  >  Equities  >  Tokyo  >  Toshiba Corp    6502   JP3592200004

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Toshiba considering $5.3 billion capital injection

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11/10/2017 | 02:57am CET
FILE PHOTO: Shoppers look at Toshiba Corp's Regza television at an electronics store in Yokohama

Toshiba Corp, desperate for cash to avoid a possible delisting, is considering raising about 600 billion yen ($5.3 billion) by offering new shares in a third-party allotment, a person briefed on the matter said on Friday.

The Japanese conglomerate has received proposals from several domestic and overseas brokerages for plans to raise money through a public offering or third-party allotment, and is looking into the option of allocating shares mainly to overseas investors, the person said.

In early trade, shares of Toshiba fell as much as 8 percent on the capital injection plan, first reported by public broadcaster NHK. They were down 4.5 percent by mid-morning, underperforming the benchmark Nikkei average's 1 percent fall.

Strapped with liabilities arising from its bankrupt U.S. nuclear unit, Toshiba agreed in September to sell its prized chip unit, Toshiba Memory, to a group led by Bain Capital for $18 billion. It needs to beef up its balance sheet by the end of the fiscal year in end-March to avoid a possible delisting.

The source told Reuters that Toshiba wants to finalize the capital injection plan by year-end because it would need shareholder approval depending on the offering price and scope of share dilution. The person declined to be identified because the plan is not public.

In a statement, Toshiba repeated its stance that it was aiming to close the deal to sell its chip business by the end of March, saying in response to the NHK report that nothing specific had been decided regarding any funding plans.

Announcing half-year results a day earlier, Chief Financial Officer Masayoshi Hirata said Toshiba had launched a working group to consider various options to raise capital in case the deal did not close in time. He offered no specifics.

Toshiba reported robust second-quarter results with a 76 percent jump in operating profit driven almost entirely by a strong performance from its memory chip unit.

If Toshiba fails to close the sale in time, that could keep Toshiba in negative net worth for a second year in a row, putting pressure on the Tokyo Stock Exchange to delist it.

(Reporting by Taro Fuse; Writing by Chang-Ran Kim; Editing by Stephen Coates)

By Taro Fuse

Stocks treated in this article : Toshiba Corp, Western Digital
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Financials ( JPY)
Sales 2018 5 053 B
EBIT 2018 470 000 B
Net income 2018 1 118 B
Debt 2018 359 B
Yield 2018 0,15%
P/E ratio 2018 1,55
P/E ratio 2019 11,38
EV / Sales 2018 0,30x
EV / Sales 2019 0,35x
Capitalization 1 165 B
Duration : Period :
Toshiba Corp Technical Analysis Chart | 6502 | JP3592200004 | 4-Traders
Technical analysis trends TOSHIBA CORP
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 11
Average target price 351  JPY
Spread / Average Target 28%
EPS Revisions
Satoshi Tsunakawa Executive President, CEO & Director
Naoto Nishida Senior Managing Executive Officer
Yasuo Naruke Director & Representative Senior Executive VP
Kouichi Ikeda Independent Outside Director
Ryoji Sato Independent Director
Sector and Competitors
1st jan.Capitalization (M$)
TOSHIBA CORP-2.76%10 356
3M28.44%137 877
SIEMENS-1.63%114 613