Toshiba Corp has announced plans to split into three companies. This was disclosed by the CEO of the company, Satoshi Tsunakawa in a press conference on Friday.
Tsunakawa said that the company has decided to split into three independent companies as a strategic reorganization. The company will now house an infrastructural service company, a device company and the third will manage Toshiba’s stake in flash-memory chip company Kioxia Holdings and other assets.
Industry observers believe that the plan, which came after a highly damaging corporate governance scandal, is partly designed to encourage shareholders to sell their stakes.
However, the plan has prompted a counter call from activist investors for Toshiba to be taken private.
Toshiba’s strategic review committee said that the idea of going private had raised internal concerns about the impact on the company’s businesses and staff retention while offers from private equity firms were not compelling relative to market expectations.
