Toshiba Corp is considering a $20 billion offer from a private equity firm, CVC Capital Partners to take it private, as the Japanese industrial conglomerate faces pressure over its governance.
According to Reuters, the proposed deal, which comes three weeks after shareholders approved an independent probe into the scandal-hit company, could shield management, particularly Chief Executive Nobuaki Kurumatani, from that scrutiny. It would, however, invite regulatory review given its government work.
“Toshiba received an initial proposal yesterday, and will ask for further clarification and give it careful consideration,” Toshiba said in a statement.
Toshiba’s board, which includes Kurumatani who joined Toshiba from CVC, and Yoshiaki Fujimori, a senior adviser at the private equity firm, discussed the proposal on Wednesday, the source with knowledge of the proposal said.
Shares in Toshiba soared 18% to their daily-limit on Wednesday.
CVC is considering a 30% premium over Toshiba’s current share price in a tender offer, putting the value of the deal at nearly 2.3 trillion yen ($21 billion) based on Tuesday’s closing share price of 3,830 yen, said the source, who declined to be identified as the matter is private.