TOKYO -- The sale of Toshiba's memory chip arm is stuck in a long-running review from Chinese antitrust authorities, making it unlikely that the deal will close before the end of March as originally planned.
Although meeting the deadline is no longer vital to the parent's survival, the delay could fuel opposition among shareholders against the sale of the money-spinner.
The Japanese conglomerate decided to sell Toshiba Memory in order to plug a hole in its net worth from massive losses at U.S. nuclear unit Westinghouse Electric. On Sept. 28, it struck a deal with a team of Japanese, South Korean and American buyers led by U.S. private equity firm Bain Capital, which quickly sought approval from the Chinese Ministry of Commerce.
A review was launched in early December and is still in progress. By contrast, European and American authorities approved the acquisition promptly, as Toshiba Memory was not being sold to a competitor.
The opinions of Chinese customers such as PC manufacturer Lenovo Group and smartphone maker Huawei Technologies will figure heavily into the probe. Bain has apparently been mediating negotiations on matters such as memory supply volumes and sale prices. "The situation has progressed this month," said a source close to the talks.