TOKYO (Reuters) – Banks are making the final adjustments to lend 1.4 trillion yen to Japan Industrial Partners (JIP), which was awarded preferential trading rights in Toshiba’s rebuilding plan. The company is expected to submit loan documentation to JIP within the month. Said two people familiar with the matter.
The 1.4 trillion yen scale includes 200 billion yen of working capital needed after the acquisition.
According to multiple sources, Toshiba’s major banks, Mizuho Bank, Sumitomo Mitsui Banking Corporation and semi-major Sumitomo Mitsui Trust Bank are planning to lend more than 1 trillion yen in total. Mitsubishi UFJ Bank and Aozora Bank will also participate.
Mizuho, Sumitomo Mitsui, Sumitomo Mitsui Trust, Mitsubishi UFJ and Aozora declined to comment. Toshiba said: “As a general rule, we cannot provide information on candidates, including joint investors, due to fears that this may compromise the fair handling of the process.” JIP is yet to comment.
Originally, Toshiba had asked JIP to submit a “letter of commitment” by November 7, stating that the bank had indicated its intention to provide the loan. The bank decided it would not be possible to decide on a loan without the prospect of securing a sufficient amount of investment, but progress has been made in discussions with JIP this month and each bank has entered the stage of narrowing the ratio of burden. was
The Toshiba acquisition will require a total of more than 2.2 trillion yen of funds, and was expected to be covered by investments from private companies such as Orix and ROHM, bank loans, preferred stock and subordinated loans.
The final purchase price could vary depending on market conditions, two of the people said.
Once the difficult bank financing has been decided, attention will shift to Toshiba’s acceptance or not of JIP’s restructuring plan. A special committee composed of external administrators will evaluate whether or not to accept the proposal and the board of directors will make the final decision after receiving the proposal.
