Toshiba undertakes share buy back of up to 6 percent

Tokyo, Jun 30 (EFE).- Japanese tech conglomerate Toshiba has undertaken a multi-million dollar purchase of its outstanding shares to around six percent of its value, for which it has already disbursed 12 billion yen ($108 million).

The company, which plans to complete the buy back process before the end of 2021, carried out Wednesday an initial purchase recovering 2,521,000 of its outstanding shares, Toshiba said in a statement.

The transaction is part of a plan to recover 27 million shares (approximately 6 % of those issued) and to invest up to 100,000 million yen (760 million euros), with the aim of boosting the profitability of its shareholders.

The company seeks to recover some 27 million shares, equivalent to around six percent of total shares issued, for which it is expected to shell out up to 100 billion yen, with the aim of boosting the profitability of its shareholders.

Under this strategy, it also plans to allocate some 50 billion yen to pay a special dividend, given that several shareholders, mainly retailers, prefer dividends, the company said.

Toshiba has promised to return to shareholders a surplus of 150 billion yen.

The conglomerate’s board of directors is in a protracted open conflict with activist investors, including foreign funds such as Singapore’s Effissimo Capital, its largest shareholder.

Effissimo was the promoter of an independent investigation that uncovered irregularities in the vote to re-elect Nobuaki Kurumatani as the company head, who resigned from office in mid-April amid a power struggle for control of Toshiba.

In the wake of the scandal, Singapore-based fund 3D Investment, its second-largest shareholder, called on the current board of directors to resign altogether.

In a new episode and a notable victory for activist investors, shareholders decided at their 25th annual meeting to dismiss the chairman of the board, Osamu Nagayama, and another senior audit executive.

Currently, approximately half of the technology company’s shares are held by foreign investors.

Toshiba, once one of Japan’s largest technology corporations – manufacturing from laptop computers to nuclear reactors -, has been in serious economic distress for years, and has been plagued with accounting scandals. EFE

mra/sc