Toshiba to unveil nuclear writedown as it scrambles for cash
TOKYO – Toshiba Corp (6502.T) will on Tuesday uncover the scale of a multi-billion dollar writedown from cost overruns at its U.S. nuclear arm, along with its recovery plans as the Japanese industrial conglomerate scrambles for cash.
Toshiba warned of a potential writedown in December, a year after a $1.3 billion (1.04 billion pounds) accounting scandal. Sources familiar with the matter say the charge will be as high as 700 billion yen ($6.2 billion) – a sum that would wipe out the group’s shareholder equity.
Japan’s Nikkei business daily reported on Tuesday that the TVs-to-construction conglomerate would warn alongside its quarterly earnings that its future is unclear.
Toshiba may also sell an interest in British nuclear venture NuGeneration Ltd to Korea Electric Power Corp (Kepco) (015760.KS), the newspaper said. Reuters reported earlier this month that Toshiba was seeking at least a partial exit from the venture.
Asked about the Nikkei report, a Toshiba spokesman declined to comment. A Kepco spokesman declined to comment, as “Toshiba’s nuclear business plan has not been crystallised yet.”
Toshiba shares fell more than 4 percent in early trade on Tuesday, underperforming a roughly flat broader market in Tokyo.
With 190,000 workers employed at some 500 units, Toshiba may be too big to fail immediately. But like other Japanese firms that have dodged financial collapse, such as Sharp Corp (6753.T), Toshiba could face protracted pain.
Chief Executive Satoshi Tsunakawa will on Tuesday outline the prospects for Toshiba’s nuclear arm and is expected to update on efforts to raise capital, including the sale of a stake in its memory chip business in Tokyo.