Toshiba Corp says it will sell a minority stake in its memory chip business as it urgently seeks funds to offset an imminent multi-billion dollar writedown, adding that its overseas nuclear division - the cause of its woes - was now under review. David Pollard reports.
Big problems call for big decisions - and this, say analysts, could be the first of many for Toshiba. (SOUNDBITE) (Japanese) TOSHIBA CHIEF EXECUTIVE, SATOSHI TSUNAKAWA, SAYING: "We decided at today's board meeting that on March 31 of this year we are to spin off our memory chip business." Less than 20 per cent will be sold initially of what, for Toshiba, accounts for 75 per cent of its profits. A move made imperative by the need to raise funds for a big bill. Six billion dollars of charges expected for cost overruns at its US power plant construction business. That too the subject of this announcement. (SOUNDBITE)(Japanese) TOSHIBA CHIEF EXECUTIVE, SATOSHI TSUNAKAWA, SAYING: "We have decided to make our nuclear business independent from Energy System Solutions, and bring it directly under control of the president." Without the funds, the charge could wipe out Toshiba's shareholder equity. Even with them, it still faces tough choices. Reportedly, it wants 1.7 billion dollars from this sale - more sales could be needed later on. For a Japanese conglomerate still battered from a 2015 accounting scandal. (SOUNDBITE)(Japanese) TOSHIBA CHIEF EXECUTIVE, SATOSHI TSUNAKAWA, SAYING: "I feel extremely responsible for what has happened recently, I will leave the decision of whether I leave or retire up to the nominating committee." Toshiba still has to confirm just how much the writedown will be. That announcement expected on February 14.