Singapore-based investment company Effissimo Capital Management, the largest shareholder of Toshiba Corp., has decided to sell a stake in Toshiba in a tender under the management of Japan Industrial Partners (JIP). This is reported by foreign media.
Effissimo owns 9.89% of Toshiba shares.
On August 8, 2023, a Japanese consortium led by the investment fund Japan Industrial Partners announced the launch of a tender for the repurchase of Toshiba shares, which will last until September 20
The transaction value is $15 billion (4620 yen per share).
For the successful completion of the tender, at least two-thirds of the shareholders must put their shares up for auction. As a result of the transaction, Toshiba will become a private company and become the property of a Japanese consortium, and the shares will be excluded from listing on the Tokyo Stock Exchange as part of privatization.
The board of Toshiba initially disagreed with the price of 4620 yen per share, considering it too low, but in March 2023 it was forced to agree to the deal in the absence of a higher offer or a competing bid.
In addition to the JIP investment fund, 17 Japanese companies, including Orix Corp., Rohm and Chubu Electric Power Company, six Japanese financial institutions, as well as foreign investors will own shares in the company specifically created for the acquisition of Toshiba.
The repurchase of shares by the Japanese consortium will allow to rebuild the business on the basis of a stable shareholder base and get away from foreign shareholders who use their stake in the company to put pressure on management. Foreign investors own slightly more than half of Toshiba's shares, in particular, 30% of the shares belong to active investors - Effissimo Capital Management, 3D Investment Partners and Farallon Capital Management (9.9%, 7.2% and 5.3%, respectively).
The deal is seen as "Toshiba's way out of an eight-year impasse," as the company in 2015 faced scandals, financial problems, resignations of senior officials and huge losses that triggered the company's financial crisis. Foreign investors managed to keep Toshiba from collapse, provided that urgent measures were taken to develop a clear long-term strategy.
Toshiba is a large multinational corporation with headquarters in Tokyo (Japan). The company's portfolio of assets includes the production of equipment, IT systems, electronic components, electric power systems, consumer electronics and logistics services.
JIP Group is an investment fund to support Japanese companies in the field of capacity building and accelerating business growth. To date, JIP Group has made more than twenty investments in divisions of Japanese companies and privatization deals, including the allocation of NEC BIGLOBE Ltd. (NEC Corporation), VAIO Corporation (Sony Corporation), Hitachi Kokusai Electric Inc. (Hitachi, Ltd) and the privatization of Hitachi Metals, Ltd.
Effissimo Capital Management Pte. Ltd. is a Singapore-based investment company in the field of financial planning and investment consulting. The headquarters is located in Singapore.
