With Toshiba Corp. expected to log an enormous loss in its nuclear power business, the company has announced a plan to remove Westinghouse Electric Co., a U.S. nuclear power company, from the group next fiscal year.
This would essentially mean Toshiba is abandoning its overseas nuclear power business.
To strengthen its fiscal base, the company is also considering spinning off part of its semiconductor division, then selling stock of the new company. The Innovation Network Corporation of Japan, a government-backed fund, is considering investing in this new company, according to sources.
Whether Toshiba can isolate the risk from its nuclear power business will be the key to its business rehabilitation.
The most important part of this is how it deals with Westinghouse, which has generated huge losses.
Toshiba President Satoshi Tsunakawa explained at a press conference on Tuesday that the company would seek to remove Westinghouse from its consolidated accounting, by selling the subsidiary's stock and other means.
"We have a number of options," Tsunakawa said.
Westinghouse is involved in building four nuclear reactors in the United States.
Construction delays on the projects have generated enormous additional personnel costs and other expenses, leading to a loss on the scale of ¥700 billion. If the delays continue, the losses could mount further.
Toshiba sees retreating from the construction of nuclear power plants as its best choice for avoiding more damage.
STREET FOOD! We're back for more in one of Japan's most traditional cities, Nara.
What was once Japan's capitol is now a place loaded with delicious street food for humans and deer alike. So, what's Nara got to offer? I hope you're hungry! (ONLY in JAPAN )
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