Toshiba Investors Approve Chip Division Sale

Toshiba shareholders approved the sale of its memory chips division to cover costs resulting from the Westinghouse bankruptcy, but not before railing at management and lamenting the downfall of a Japanese icon, according to Bloomberg.

Incensed investors took turns to hurl abuse at executives during a meeting convened to take a vote on the intended disposal of its prized semiconductor business. Toshiba is looking to sell a majority stake in the unit to mend a balance sheet ravaged by billions of dollars in writedowns related to cost overruns at nuclear subsidiary Westinghouse.

“Toshiba is now a laughing-stock to the whole world,“ one shareholder said during a question-and-answer section, raising his voice. “I think all of you are incompetent as managers. Do you even know what’s happening?“ Another shareholder addressed the executives as “trash.“

Shareholders green-lit the envisioned chip-division sale anyway. The company has said it’s received some offers for its NAND memory business, a sale of which should be enough to restore shareholder equity to positive by the end of the next fiscal year. About 10 companies are said to have expressed interest.

The semiconductor business is Toshiba’s crown jewel and makes the memory chips that go into computers, smartphones and data centers. It accounted for about 25 percent of Toshiba’s 5.67 trillion yen in revenue during the latest fiscal year. “The sale of memory business is even more important now that Westinghouse Chapter 11 application is likely to result in excessive debt expanding considerably,“ Yukihiko Shimada, a Tokyo-based analyst at SMBC Nikko Securities Inc., wrote in a report.

Toshiba CEO Satoshi Tsunakawa opened proceedings by apologizing to shareholders and reassuring them the company is doing everything in its power to avoid a de-listing after missing earnings reporting deadlines. But investors remained displeased. “It doesn’t seem like the management is taking this seriously enough,“ another shareholder said during the question-and-answer session, drawing applause. “Whatever happened happened. I want to know what happens next.“