Variables to Toshiba Acquisition
A possibility that a bid to take over the memory business from Toshiba by a Korea-Japan-US alliance, which SK Hynix participated in, may run aground is spreading in Japan. The point is that SK Hynix that took part in the takeover race in the form of giving a loan is demanding voting rights and Western Digital filed a lawsuit to stop the sale process. The deal scheduled to be signed in a Toshiba shareholders' meeting on March 28, is being postponed without a notice.
The possibility was first suggested by the local media in Japan. The Nihon Keizai Shimbun recently pointed out that differences in opinions on the terms of the acquisition were revealed internally, including SK Hynix’s demand for voting rights and pointed out that if Toshiba and the Korea-US-Japan alliance fail to hammer out an agreement, the preferred bidder may be changed. The newspaper quoted an official of the Innovation Network Corporation of Japan as saying, "The decision to single out the Korea-US-Japan Alliance as a preferred bidder is not legally binding," accentuating the possibility of the alliance’s failing to take over the memory business from Toshiba as much as possible.
The Korea-US-Japan alliance including SK Hynix was selected as the preferred bidder for the takeover of Toshiba's memory business last month. But it is reported that SK Hynix's demand for voting rights and Western Digital’s opposition to the sale have brought eleventh-hour negotiations some problems. The Japanese government has supported the alliance by believing that if the Korea-US-Japan alliance led by Japanese players such as the Industrial Innovation Organization of Japan takes over Toshiba’s memory unit, it can prevent semiconductor technology from leading overseas. However, the Japanese government judges that if SK Hynix exercises its voting rights, the situation will change.
As the situation turns unfriendly with SK Hynix, Park Jung-ho, president of SK Telecom in charge of the takeover, actually negotiated the terms of the acquisition of Toshiba’s memory business under the table with officials of the Korea-US-Japan alliance in Japan on July 7,
In the meantime, a lawsuit filed by Western Digital is also emerging as a variable. The Californian courts will hold the first examination of Western Digital's request to stop selling Toshiba’s memory unit on July 14 (local time). The ruling will be made as early as on the day and can affect negotiations between the Korea-US-Japan alliance and Toshiba.