A major Japanese multinational conglomerate has been forced to sell a minority stake in its memory chip business in order to raise capital amidst an impending legal lawsuit from a financial institution. Toshiba are being sued by Japanese Trust Banks over its 2015 accounting scandal.
It’s the latest in a number of setbacks faced by Toshiba – it is currently embroiled in a separate imminent multi-billion dollar write-down. A spokesman for the firm also confirmed that it is now reviewing its overseas nuclear division – which has been credited as the main source of its current financial woes.
There is also widespread speculation that Toshiba chairman Shigenori Shiga is ready to resign from his position and take responsibility for the upcoming charge which has been estimated at around $6 billion.
The announcements have served only to increase the uncertainty surrounding the company – and that impacted its market price as shares plummeted 4% on the stock exchange this morning.
Takeshi Tanaka, an analyst has stated that company has offered no explanation in relation to how Toshiba intends to control risk moving forward. "No explanations were offered as to the ultimate scale of the impairment losses to be recorded in the business or how the company intends to control risk going forward.”
Mitsubishi UFJ Trust and Banking Corp publicly declared it is preparing to seek 1 billion yen ($8.7 million) in damages on behalf of its client pension funds after Toshiba's shares slid in the wake of the accounting scandal two years ago. The bank is a unit of Mitsubishi UFJ Financial Group.
Two other trust banks, Sumitomo Mitsui Trust Bank Ltd and Mizuho Trust & Banking Co are also preparing similar suits, said sources with direct knowledge of the matter, declining to be identified as they were not authorized to speak to the media. Representatives for the two banks declined to comment.
Last October, Toshiba disclosed that 45 overseas financial investors filed a lawsuit seeking remuneration in the region of 16.7 billion yen in damages since it first admitted to reporting inflated profits – dating back to 2008. This is in addition to 15 organizations and individuals filing lawsuits in Japan that total 15.3 billion yen.
