According to two people with knowledge of the negotiations, CVC Capital Partners is weighing 20 20 billion in bids for the majority of Toshiba that could privatize the Japanese industrial conglomerate and remove activist investors from its shareholder registry, according to two people with knowledge of the negotiations.
The deal, which ranks among the 20 largest leveraged buyouts in history, marks another turning point. Corporate story That Toshiba snatched from a love-padding scandal in 2015 and is on the verge of bankruptcy two years later Humiliating defeat In a showdown with its largest shareholders last month.
CVC is expected to partner with other investment funds to finance the deal, the first Nikkei Asia reported. The Luxembourg-based buyout group declined to comment.
In a statement on Wednesday, Toshiba said it would carefully study the initial proposal received from the CVC a day earlier.
Foreign-led deal to remove 145-year-old Toshiba from Tokyo Stock Exchange Huge symbolic step, After years of growing growth and acquisitions by foreign funds, the consultants said they were directly involved in the combination. American private equity firms such as Bain and KKR see Japan as one of them The most targeted rich market In this world.
But Toshiba is particularly vulnerable. The company’s protracted financial crisis, which followed the collapse of the U.S. nuclear business in 2013, was temporarily resolved when the company managed to issue a ম্যান 5.3bn equity emergency to Goldman Sachs.
Although the deal was completed quickly, it left the Toshiba shareholder register Heavy crowds With foreign activist funds – groups that may see profitable exit opportunities if the CVC deal is done at a large premium.
Toshiba activist investors include the secret Singapore-based fund Ephesimo, which put pressure on the group’s largest shareholder and Nabuaki Kurumatani, who was the chief executive. Rented in 2018 The company’s roundabout.
In the three years since his appointment, Kurumtani has remained There have been repeated clashes With shareholders. At an extraordinary general meeting last month, Toshiba’s management suffered an embarrassing defeat after shareholders voted in favor of Ephesimo’s proposal for an investigation. Company behavior During last year’s annual general meeting
Non-Japanese private equity funds will need the approval of the Japanese government as a bid, and an acquisition of Toshiba will be particularly sensitive because it manages the country. Nuclear reactor.
The CVC, however, is no stranger to Toshiba. Kurumtani, a former banker, was president of the European Fund for Japanese Forces before taking over as Toshiba’s chief executive. Yoshiyaki Fujimori, Senior Executive Advisor to the CVC of Japan, is also a member of the Japanese Group Board.
The deal must be one Largest leverage buyout Financial crisis since 2008, on the same scale .2 17.2bn acquisitions According to Refinitive, the lift business of Advent International and Thysencrupp of Synven last year.
CVC raised ২১ 21 billion last year for business in Europe and the United States, and a separate $ 4.3 billion in Asian funds, according to its website.
Toshiba’s purchase, however, will be marked in contrast to the company’s general style in the region, in which it typically buys groups that are priced between 250 250 million and 1.5 1.5 million, its site said. In February, it bought a majority stake in Shisido’s personal care business.
An industry adviser said several private equity firms had previously made bids for Toshiba, estimating that if they broke up the company, the sum of its shares could exceed its current valuation, an industry adviser said. The adviser added, however, that the size and complexity of the deal made it difficult to remove it earlier.