Toshiba’s chip IPO likely short-circuit | Business Upturn

Toshiba’s chip IPO likely short-circuit

The Toshiba’s chip debut unit, may short-circuit in volatile markets. Years after the Japanese conglomerate’s crown jewel was sold to a group led by U.S. buyout firm Bain Capital, the rebranded Kioxia is going public in Tokyo at a valuation of $20 billion.

Financial desperation forced the scandal-hit Toshiba to offload its prized flash-memory division in the year 2018. The sale was chaotic, but Bain managed to pull together a consortium including Apple and South Korea’s SK Hynix in a deal worth some $19 billion. Political backlash against foreign control of local technology meant Toshiba was able to retain a roughly 40% voting right.

Toshiba, which will have a 32% stake after, and Bain will be glad for a chance to partially exit. The private-equity giant had delayed the listing by a year. Now the benchmark Topix index is up by a third from a pandemic-induced low in March. Moreover, demand for memory chips in new smartphones, and video-games consoles sold by Microsoft and Sony later this year should also be a boon.