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Hon Hai considering limiting Toshiba Memory investment

Yomiuri Shimbun file photo

Toshiba Corp. President Satoshi Tsunakawa, right, explains about the company’s earnings report for April-December last year at a press conference in Minato Ward, Tokyo, on April 11.

The Yomiuri Shimbun Taiwan’s Hon Hai Precision Industry Co., one of the bidders for Toshiba Memory Corp., is mulling a plan in which it would limit its investment in the semiconductor memory chip manufacturer to a 20 percent stake, it has been learned.

Toshiba Memory is a subsidiary of Toshiba Corp.

Under the plan, the remaining 80 percent would be divided into two 40 percent stakes, with each stake owned by Japanese or U.S. companies. The move is believed to be aimed at alleviating the Japanese government’s fears over technology leaving the country.

According to a source, Sharp Corp., which is under the umbrella of Hon Hai, is part of the plan as an investing company, and Toshiba itself plans to retain some shares.

Hon Hai has several factories in China. As the Japanese government is concerned about memory technology being leaked abroad, which could jeopardize national security, it may issue a stay order to stop an acquisition plan by applying the Foreign Exchange and Foreign Trade Law if a buyer is deemed unfavorable.

Hon Hai plans to build a new plant in the United States after the investment, taking into consideration the employment situation, which U.S. President Donald Trump places importance on.

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