Toshiba chip unit worth as much as $40B, activist fund says

|About: Toshiba Corp. (TOSBF)|By:, SA News Editor

Toshiba's (OTCPK:TOSBF, OTCPK:TOSYY) chip unit is worth as much as $40B, double the sale price agreed with a Bain-led consortium, says Hong Kong-based activist investment fund Argyle Street Management.

Toshiba Memory, the world’s second largest producer of NAND chips, is due to be sold for 2T yen ($18.6B) but Argyle argues the unit is worth 3.3T-4.4T yen, citing a third-party valuation analysis.

Argyle is seeking to persuade Toshiba to either negotiate a higher price or list the unit, highlighting concerns that the company agreed to sell it too cheaply.

The sale failed to close by a March 31 deadline as the two sides are still waiting on regulatory approval from China, giving Toshiba the option of cancelling the sale without penalty, and the industry and bankers are waiting to see how much momentum Argyle will gain in its campaign.