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Toshiba sets March date for vote on spin-off plan

TOKYO (AFP) – Japanese conglomerate Toshiba said yesterdayit would hold an extraordinary meeting of shareholders on March 24 to vote on its plan to spin off its devices unit.

The ballot will not be legally binding but is intended to “confirm the views of our shareholders regarding moving forward”, Toshiba said, with a binding resolution to be voted on some time in 2023.

But the board will hope the vote produces solid enough support for its revised proposal, which also includes selling “non-core” business including Toshiba Tec and other units.

CEO Satoshi Tsunakawa said he would seek a majority mandate from shareholders at the meeting, rather than a more stringent two-thirds majority.

Toshiba last November announced a proposal to spin off two new businesses, one dealing with infrastructure and the other devices.

The Toshiba logo at the company’s facility, Kawasaki, Japan. PHOTO: CNA

But last week it revised the plan, saying spinning off a single unit would be less costly and time-consuming and make it easier to list the new firm.

The vote also came on the heels of an unexpected buyout offer from a private equity fund associated with then CEO Nobuaki Kurumatani, with allegations it was intended to blunt the influence of activist investors.

Reception to its initial plan to split into three firms was mixed, and while some analysts said the proposal could help maximise value, there was public opposition from several key shareholders.

The shareholder meeting was announced as Toshiba yesterday downgraded its annual operational profit forecast, citing the semiconductor shortage and rising costs.

The firm cut its operating profit expectations for the year to March to JPY155 billion against an earlier forecast of JPY170 billion.

Annual sales are now seen at JPY3.34 trillion yen, compared with a previous JPY3.35 trillion forecast.

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