Toshiba president Nobuki Kurumatani made the announcement on Wednesday, as an offer to buy from a private equity fund announced the firm into an uproar within the Japanese company on Wednesday.
Two other funds were considering their own proposals for a Japanese household name, possibly setting up a bidding war, according to the resignation report.
In a statement, Toshiba said the board accepted Kurumatani’s resignation, without giving details of why he asked to step down. He said that chairman Satoshi would be replaced by Sunakuva.
The move came after board members raised questions about a purchase proposal from CVC Capital Partners, where Kurumatani previously led Japanese operations.
The private equity firm is reportedly offering a deal in excess of $ 20 billion (about Rs 1,50,410 crore), although there are reports that some people in Toshiba consider that amount to be too small.
The Financial Times said on Wednesday that another private equity fund, KKR, plans to offer a large buyout offer of its own.
Bloomberg News reported that a third, Canadian Brookfield Asset Management, was also exploring a possible proposal.
Toshiba confirmed last week that it had received an offer from CVC Capital Partners that would take Toshiba private.
Rapid decision-making by Toshiba’s management allows the firm to produce faster, which has recently collided with shareholders.
It may also allow Toshiba to focus resources on renewable energy and other core businesses.
There is a close relationship between CVC and Toshiba.
Kurumatani worked for the fund between 2017 and 2018, and a senior executive at CVC Japan currently serves as an external director on Toshiba’s board.
The closeness has reportedly expressed concern, and United First Partners’ head of Asian research Justin Tang said Kurumatani’s departure would “remove uncertainty over a potential conflict of interest”.
This would “force the board to seek other proposals that are in the best interests of shareholders”, he told AFP.
“It is currently a very sticky situation.”
The turmoil inside Toshiba is a fresh setback for the firm, which is trying to improve its governance following an accounting scandal in 2015 and the 2017 bankruptcy of its US nuclear subsidiary.
After the restructuring, its earnings rose again and it returned to the iconic first segment of the Tokyo Stock Exchange in January.
Any procurement proposal is likely to face significant challenges, including financing and securing regulatory approvals.
Last week Toshiba warned that the CVC expected financial support, which was likely to include “substantial time and considerable complexity”.
Shortly after the market opened in Tokyo, Toshiba shares jumped 4.46 percent to JPY 4,800 (about Rs 3,300).
The CVC’s offer is reportedly around JPY 5,000 (approximately Rs. 3,400) a share, but Tang said he believed “to get shareholders on the line (around Rs 4,100) north of JPY 6,000″. Is necessary.”
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