Toshiba Flounders As Shareholders Reject Platform Anew

A majority of Toshiba Corp. shareholders on Thursday rejected a management proposal to split the Japanese conglomerate into two listed companies, leaving the company floundering as it aims to reform its image following a string of scandals.

Photo Insert: Toshiba has a variety of businesses, from nuclear power and elevators to hard disk drives and semiconductors.

Toshiba, a household name in Japan with a nearly 150-year history, had sought support for the new reform plan at an extraordinary shareholders' meeting after its earlier plan to divide into three was met with opposition.

The outcome of the vote is not legally binding but indicates likely rejection when the company holds a planned regular shareholders' meeting in June 2023 for a final decision.

Toshiba has a variety of businesses, from nuclear power and elevators to hard disk drives and semiconductors. In fiscal 2020, which ended in March 2021, it had over 3 trillion yen ($24.8 billion) in sales.

"We will consider a range of options to improve corporate value," Toshiba President and CEO Taro Shimada said following the results of the vote. A proposal by some activist shareholders to take the firm private through selling Toshiba shares to foreign hedge funds, among other entities, was also rejected at the meeting.

The dismissals emphasized the uncertainty over Toshiba's future as its shareholders and management battle over what recourse best serves the company, half of which is owned by foreign entities.

In November, the firm initially proposed a plan to split into three listed companies -- two spinoffs that would focus respectively on the infrastructure and device businesses and a third that would own a stake in flash-memory chip company Kioxia Holdings Corp.

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