April 24, 2017 — TOKYO– Toshiba Corporation (TOKYO: 6502) (“the Company”) today announced that it has decided to split off its four in-house companies into wholly-owned subsidiaries. After the company splits, Toshiba Group (“the Group”) will further enhance collaboration between the split-off companies (“New Company”), and, at the same time, aim to maximize the value of each business. In addition, it will establish an optimized structure for ensuring business continuity in respect of maintaining special construction business licenses required to do business in Japan.
After executing the splits, Toshiba Corporate will further concentrate on maximizing the Group’s value and strengthening its governance system.
About the business entities
The company splits will allow the New Companies, as independent business entities, to clarify their responsibilities to the market and customers, which will ultimately support maximization of their business value. Additionally, the New Companies will aim to refine governance and risk management structures so as to match their diverse business environments, and will directly secure the services of external auditors.
The company splits will be effected as follows, on July 1st and after.
As of July 1, 2017
Infrastructure System & Solutions Company
The Company will split off its in-house company, Infrastructure System & Solutions Company, and merge it into Toshiba Electric Service Corporation, which is responsible for part of the installation work, electrical construction, maintenance and inspection services in the social infrastructure business and holds special construction business licenses. As the succeeding company holds special construction business licenses, this will realize a continuous and smooth business transaction. The New Company also aims to realize continuous growth for the social infrastructure business by positioning it to continue to promote a spiral lifecycle business offering products, systems and services that improve customer value, which will ultimately lead to maximization of its business value.
Storage & Electronic Devices SolutionsCompany
The Company will split off its in-house Company, Storage & Electronic Devices Solutions Company and transfer it to a newly established company. The Company established Toshiba Memory Corporation on April 1 for the memory business. With this company split, the Company aims to realize continuous growth and maximization of its other electronic devices business, including discrete semiconductors, system LSIs, HDDs and related products, by providing products and services that maximize customer value.
Industrial ICT Solutions Company
The Company will split off its in-house company, Industrial ICT Solutions Company, and merge it into Toshiba Solutions Corporation, which is responsible for construction work related to the ICT solutions business and holds special construction business licenses. This will allow continuity of business operations that require such licenses. As the succeeding company holds special construction business licenses, this will maintain continuity in business areas that requires such licenses. The merger will also allow establishment of a business structure that unifies development, manufacturing and sales of ICT solutions that utilize IoT and AI, increase the scale of solutions businesses for manufacturing, industry, social infrastructure, distribution and finance, government and municipalities, and support further business growth. The New Company will also realize timely responses to digital transformation, aim to expand its business through its “SPINEX” IoT architecture, as an innovator that creates and provides valuable services, and contribute to maximizing the corporate value of the Group.
As of October 1,2017
Energy Systems & Solutions Company
The Company will split off its in-house company, Energy Systems & Solutions Company, and the Nuclear Energy Systems & Solutions Division, and transfer them to a newly established company. The New Company will obtain special construction business licenses, in order to maintain business continuity in respect of its ability to engage in businesses that requires such licenses. By this, it will realize a continuous and smooth business transaction. The New Company also aims to realize further growth for the energy business by offering products, systems and services that improve customer value in next generation energy sources.
About the corporate function
The Company will continue to strengthen the Group’s internal controls, as announced in the March 14th announcement, “Measures to Rebuild Toshiba,” by further promoting collaboration between Toshiba Corporate, which will dedicate itself to enhancing corporate functions, and the Group’s affiliated business entities. While details are still to be determined, Toshiba Corporate will focus on maximizing corporate value and strengthening governance of the Group as a whole, and advance the Group’s business strategic planning, including flexible reorganization on the business portfolio, resource allocation and enhanced risk management.
Today’s decision follows the “Strengthening Toshiba Group’s Organizational Management,” as disclosed in “Measures to Rebuild Toshiba,” announced on March 14th, 2017. On the same date, the Company also announced its intentions in respect of “Eliminating Risk Related to the Overseas Power Business,” which has been realized by the commencement of Chapter 11 proceedings that eliminate Westinghouse from FY2016 consolidated earnings results, as was announced on March 29th.
Toward “Swiftly Recovering and Strengthening the Financial Base,” the Company established Toshiba Memory Corporation on April 1st, to secure management resources for the continued growth of Memory business, and to further enhance the Group’s financial bases by considering transfers of shares in the new company to a third-party, up to majority.
Toshiba Group will further continue upmost effort to recover the trust of shareholders and investors and all other stakeholders.
Read the full release on Toshiba’s Investor Relations page.
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