Australia markets open in 3 hours 48 minutes
  • ALL ORDS

    6,818.10
    +21.20 (+0.31%)
     
  • AUD/USD

    0.6799
    -0.0071 (-1.03%)
     
  • ASX 200

    6,629.30
    +16.70 (+0.25%)
     
  • OIL

    99.69
    -8.74 (-8.06%)
     
  • GOLD

    1,766.80
    -34.70 (-1.93%)
     
  • BTC-AUD

    30,087.75
    +778.10 (+2.65%)
     
  • CMC Crypto 200

    442.16
    +2.14 (+0.49%)
     

Toshiba Taps Activists for Board, Boosting Odds of Buyout

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·2-min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

(Bloomberg) -- Toshiba Corp. tapped candidates from its activist shareholders to serve as directors, increasing the likelihood of privatization as a staunch opponent of a buyout will step down from the board.

Most Read from Bloomberg

The Tokyo-based firm nominated an executive each from Elliott Management Corp. and Farallon Capital Management, it said in a statement Thursday. Former Chief Executive Officer Satoshi Tsunakawa will leave the board.

If elected by shareholders at the annual meeting in June, the candidates could help smooth the path for a sale to private equity as the conglomerate seeks offers on privatization and other strategic alternatives.

“Having shareholder representatives join the board strengthens the alignment between shareholders and management,” Raymond Zage, chairperson of the nomination committee, said in the statement.

The announcement of the director slate was initially delayed earlier this month as the company said it needed more time. Proposed candidates met opposition from some Toshiba executives for being close to activist shareholders, broadcaster TV Tokyo reported at the time.

Eijiro Imai, a managing director at Farallon Capital Japan, is one of the proposed director candidates, while Nabeel Bhanji, who hails from Elliott, is another.

Akihiro Watanabe, chairman, managing director and chairman of Asia corporate finance at Houlihan Lokey, was nominated as chairman of the board.

Tsunakawa, who is departing, was one of the most vocal opponents of going private within Toshiba. In an interview with Bloomberg News in February, the 66-year-old company veteran said Toshiba would lose orders from public entities and would be forced to sell sensitive technology operations if it did so. Tsunakawa’s alternative vision for the firm, to split in two, was voted down by stock owners in March.

Toshiba, which is now exploring other strategic options, has set a deadline of May 30 for receiving non-binding proposals from investors, including bids to go private.

Japan Investment Corp., a government-backed fund, is considering is considering making an offer, Bloomberg News reported this week, citing people familiar with the matter. Bain Capital, Blackstone Inc., CVC Capital Partners and KKR & Co. are among the buyout firms that are also weighing bids, Bloomberg has reported.

Read more: Japan State-Backed Fund JIC Is Said to Explore Toshiba Bid

Toshiba executives have opposed director candidates from activist shareholders before.

When Effissimo Capital Management Pte., the company’s largest stock holder, sought in 2020 to put one of its co-founders on Toshiba’s board, shareholders rejected it. Suspicious about how the vote was conducted, Effissimo called for independent investigators be appointed to look into it, winning a landmark shareholder vote last year. The subsequent report from the probe alleged that Toshiba management worked hand in hand with government allies to sway the outcome, findings that four Toshiba board members described as “deeply disturbing.”

(Updates with board chairman in seventh paragraph)

Most Read from Bloomberg Businessweek

©2022 Bloomberg L.P.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting