China regulators open antitrust probe of Toshiba deal - newspaper

China regulators open antitrust probe of Toshiba deal - newspaper
FILE PHOTO: A reporter raises his hand for a question during a news conference at the Toshiba Corp company headquarters in Tokyo, Japan June 23, 2017. REUTERS/Issei Kato/File Photo
Text size Aa Aa

(Reuters) – Chinese regulators have opened an antitrust investigation into Toshiba Corp’s <6502.T> $18 billion (£13.4 billion) deal to sell its memory chip unit to a consortium led by Bain Capital LP that includes memory maker SK Hynix <000660.KS>, possibly delaying the March closing date Toshiba’s leaders have targeted, the Nikkei Asian Review newspaper reported on Friday.

Chinese regulators started their review earlier this month, despite the fact that Toshiba had applied for it in September, when it reached a deal with Bain and its partners, the newspaper said.

Such reviews in China typically take about four months but sometimes stretch to six, making it unclear whether Toshiba can hit its March 2018 target for closing the deal, the paper said.

A U.S.-based spokeswoman for Toshiba was not immediately able to comment on the report.

Toshiba is racing against the clock to complete the deal because it needs to bolster its balance sheet before March to avoid potentially being delisted from the Tokyo Stock Exchange. A delisting would be a major blow for one of Japan’s largest and oldest industrial companies.

The deal has already secured regulatory approval in the United States and Japan but still needs approval in China, Taiwan and South Korea, the Nikkei Asian Review said.

Toshiba reached the deal with Bain and its partners after a protracted legal fight with Western Digital Corp <WDC.O>, which had a joint venture with Toshiba around memory chips and objected to the deal’s inclusion of SK Hynix. Toshiba and Western Digital settled their differences earlier this week, but shareholder and regulatory complications remain before Toshiba can close the deal.

(Reporting by Stephen Nellis in San Francisco; Editing by Jonathan Oatis)

euronews provides breaking news articles from reuters as a service to its readers, but does not edit the articles it publishes. Articles appear on for a limited time.