Western Digital goes to arbitration over Toshiba auction
- Autor:Ella Cai
- Lassen Sie auf:2017-05-16
Western Digital has initiated an arbitration procedure over its bid for Toshiba’s chip business.
The arbitration will be heard by the International Chamber of Commerce International Court of Arbitration
This procedure, which could take months, could delay the auction which was planned for this month. However, this morning, in Tokyo, Toshiba CEO Satoshi Tsunakawa said the company had no plans to postpone the may 19 day for the second round of the bidding.
Toshiba needs the proceeds of sale quite urgently to pay off claims against its nuclear unit.
“Toshiba’s attempt to spin out its joint venture interests into an affiliate and then sell that affiliate is explicitly prohibited without SanDisk’s consent,” says Western Digital CEO Steve Milligan, “seeking relief through mandatory arbitration was not our first choice in trying to resolve this matter. However, all of our other efforts to achieve a resolution to date have been unsuccessful, and so we believe legal action is now a necessary next step.”
This agreement, claims Western Digital, gives it the right to sole negotiating rights for the sale of the whole of Toshiba’s chip business.
Toshiba is responding to the arbitration move by preparing to bar all Western Digital employees from the jv sites.
Toshiba is also warning that it may announce an FY loss to the end of March of $8.4 billion – the largest in Japanese corporate history.
The arbitration will be heard by the International Chamber of Commerce International Court of Arbitration
This procedure, which could take months, could delay the auction which was planned for this month. However, this morning, in Tokyo, Toshiba CEO Satoshi Tsunakawa said the company had no plans to postpone the may 19 day for the second round of the bidding.
Toshiba needs the proceeds of sale quite urgently to pay off claims against its nuclear unit.
“Toshiba’s attempt to spin out its joint venture interests into an affiliate and then sell that affiliate is explicitly prohibited without SanDisk’s consent,” says Western Digital CEO Steve Milligan, “seeking relief through mandatory arbitration was not our first choice in trying to resolve this matter. However, all of our other efforts to achieve a resolution to date have been unsuccessful, and so we believe legal action is now a necessary next step.”
Last year, Western Digital bought a jv stake previously held by SanDisk under which manufacturing facilities are jointly owned and operated by Western Digital and Toshiba.
This agreement, claims Western Digital, gives it the right to sole negotiating rights for the sale of the whole of Toshiba’s chip business.
Toshiba is responding to the arbitration move by preparing to bar all Western Digital employees from the jv sites.
Toshiba is also warning that it may announce an FY loss to the end of March of $8.4 billion – the largest in Japanese corporate history.
