Toshiba jumps on reports Amazon, Dell could join Hon Hai bid for chip unit

Toshiba is among the top performers in the Japanese stock market today following reports one of the leading bidders for the conglomerate’s prized memory chip unit is considering a plan that may help alleviate concerns about foreign ownership.

Taiwan’s Hon Hai Precision Industry is said to be considering a plan where it would acquire a 20 per cent slice of Toshiba’s Nand flash memory spin-off, with the remainder to be split among Japanese and US companies that could include Amazon and Dell, according to Mainichi.

Under the plan, Sharp would take a 10 per cent stake, with another Japanese company picking up an equivalent slice.

Hon Hai, also known as Foxconn, had approached Apple about a potential joint bid for Toshiba’s chip business. Mainichi reports the Taiwanese company may ask its main client to take a circa 20 per cent stake in Toshiba’s memory business, and for Amazon and Dell to each take a 10 per cent holding.

Toshiba shares were up 5.1 per cent, making them the seventh-best performer on Japan’s Topix today, which was up 0.4 per cent. Shares had been up as much as 7.2 per cent this morning, and have put on nearly 11 per cent over the past three consecutive sessions.

On Tuesday the Innovation Network Corporation of Japan (INCJ), a government-backed fund, officially expressed its interest in Toshiba’s chip division that is being put on the block for more than $18bn in an effort to repair Toshiba’s severely damaged balance sheet.

Japanese government officials and business leaders have previously expressed concerns about the Toshiba’s flash memory technology falling into Chinese hands, but efforts to find a consortium of Japanese buyers has so far made little progress.