Shareholders of Toshiba Corp. on Thursday approved the reappointment of all 11 directors who backed a tender offer made by a consortium led by Japan Industrial Partners Inc., although some investors criticized the offer as being "too cheap."
The effective investor approval for the 2 trillion yen ($14 billion) buyout plan is expected to move forward the planned privatization of the struggling tech conglomerate, with the tender offer starting as early as late next month.
If the tender offer is agreed on and Toshiba becomes private, the company will be able to cut ties with overseas activist shareholders seeking short-term shareholder returns.
Toshiba is in the midst of restructuring efforts, struggling to recover from a spate of problems over the past decade, including an accounting scandal and massive losses in its U.S. nuclear business.
"The buyout allows us to push forward with a reform under a stable shareholder base," President Taro Shimada told a shareholders' meeting in Tokyo, as executives sought the understanding of shareholders, saying the JIP proposal was chosen in a fair and competitive process.
Not all investors were satisfied by the explanation, however, with some shareholders arguing that the offer price of 4,620 yen per share is too low, compared with the stock price of over 5,000 yen on the Tokyo stock market in April last year when Toshiba started soliciting strategic proposals.
"It is rude to shareholders that Toshiba is trying to sell itself for such a low price," one of the shareholders said at the meeting.
Toshiba, which announced in March the buyout offer led by the Tokyo-based fund, recommended its shareholders earlier this month to accept the offer.
Previously, Toshiba said it was undecided on if it would make such a recommendation despite the board's approval of the JIP offer, on hopes that that the fund may raise the offer price.
But the company eventually decided to recommend the offer due to the worsening business environment for its 40 percent-held chip affiliate Kioxia Holdings Corp., which affects its corporate value, and a lack of any other rival offer, it said.
