ODD Business Separation
13 January 2004 - 6:01PM
UK Regulatory
RNS Number:1498U
Toshiba Corporation
13 January 2004
January 13, 2004
Toshiba Corporation
Notice of Corporate Separation of Optical Disk Device Business
Based on the agreement between Toshiba Corporation (hereafter called "Toshiba")
and Samsung Electronics Co., Ltd. (hereafter called "Samsung"), Toshiba has
decided to separate its optical-disk-device business (hereafter called "
Separation Business") on March 29, 2004. On the same date, the Separate Business
is to be succeeded by TS Storage Technology, Ltd. (hereafter called "Successor
Company").
1. Purpose of separation
The optical-disk-drive business faces fast changing customer requirements for
faster, slimmer drives, and a rapid transition in the main product to recordable
DVD drives. Price erosion and alliances are also making themselves felt further
intensifying competition. In this environment, advantages in technology, product
development and price competitiveness are all crucial for survival. The new
joint venture will construct a competitive business structure that can promote
optimized use of management resources and leadership in the global market.
2. Outline of Corporate Separation ("Kaisha-Bunkatsu" A reorganization
method under the Commercial Code of Japan. Hereafter Corporate Separation.)
(1) Schedule
January 13, 2004 Approval by board of directors for Corporate
Separation Plan
January 13, 2004 Conclusion of Corporate Separate contract
March 29, 2004(plan) Date of Corporate Separation
(2) Method
- Corporate Separation
"Simplified separation method"
- Reason for selecting this method
This method was chosen to transfer the relevant business more
efficiently.
(3) Allocation of share
The successor company will newly issue to Toshiba 106 shares. The successor
company will allocate 100% its share to Toshiba as the successor company is 100%
owned by Toshiba at the time of Corporate Separation date.
(4) Cash Subsidy
Toshiba and Samsung will not receive any cash in the process of Corporate
Separation.
(5) Legal Right and Obligations
The Successor Company will succeed to the assets, liabilities, rights and
obligations, including contract status, involved in the transferred business.
(6) Forecast of Payment of Obligation
Toshiba considers that the Successor Company as well as Toshiba will be able to
fulfill all payment obligations that will become due after the Corporate
Separation date.
3. Outline of the companies
Company Name Toshiba TS Storage Technology, Inc.
(Separation Company) (Successor Company)
As of September 30, 2003 As of December 31,2003
Business Development, manufacture, sales and Development, manufacture, sales
service of digital products, and service of
electronic devices and components, optical-disk-device, its
social infrastructure equipment and application equipment and its
systems, home appliances, and other associate parts.
products
Established June 25, 1904 December 18, 2003
Head Office Shibaura 1-1-1, Shibaura 1-1-1,
Minato-ku, Tokyo Minato-ku, Tokyo
Representative Tadashi Okamura Seiya Shimaoka
President and CEO President and CEO
Capital 274,926 million yen 10 million yen
Outstanding Share 3,219,027,165 shares 200 shares
Shareholders' Equity 691,716 million yen 10 million yen
Total Assets 2,802,670 million yen 10 million yen
Financial Closing Date March 31 March 31
Number of Employees 39,076 N/A
Major Customer Government, N/A
Local Government
Corporations
Principal Shareholders and The Master Trust Bank Toshiba Corporation 100%
Shareholdings
of Japan(trust) 5.26%
Japan Trust Service
Bank, Ltd(trust) 4.25%
The Dai-ichi Mutual
Life Insurance Company 3.63%
Major Banks Sumitomo Mitsui Banking Corporation N/A
Mizuho Corporate Bank, etc.
UFJ Bank
Relations Capital: Separation Company holds 100% shares of Successor
Company.
HR : The directors of Successor Company are the employees of
Separation Company.
Note: TS Storage Technology, Inc. was established to integrate the
optical-disk-device business of Toshiba and Samsung.
Recent 3-year Business Results
(Unit: Million yen)
Toshiba Corporation (Separation Company)
Financial Closing Date March 2001 March 2002 March 2003
Sales 3,678,977 3,196,896 3,408,251
Operating Income (loss) 125,880 -196,752 35,188
Recurring Income (loss) 95,327 -231,816 43,378
Net Income (loss) 26,411 -260,332 83,364
Net Income (loss) per share (yen) 8.20 -80.87 25.90
Annual Dividend per share (yen) 10.00 0.00 3.00
Shareholders Equity per share (yen) 286.42 198.58 220.14
Note: The result of TS Storage Technology, Inc. was omitted due to the no
business activities.
4. Business to be separated
(1) Business to be separated
Business Planning, Product Development Procurement and sales and marketing in
connection with optical-disk-device conducted in Storage Device Division of
Digital Media Network Company in Toshiba.
(2) Business Results for the year ending March 31, 2003 (Unit: Million yen)
Separation Business
Sales Amount 100,000
(3) Assets and Liabilities of Separation Business (forecast as of March
29,2004)
(Unit: Million yen)
Assets Liability
Book Value Book Value
Assets 10,600 Liabilities 9,370
Shareholders' Equity 1,230
Total 10,600 10,600
5. Outline of the New Company after changing its name
Toshiba Samsung Storage Technology Co.(New Company)
Business Development, manufacture, sales and service of optical-disk-device, its
application equipment and its associate parts.
Head Office Saiwai-ku, Kawasaki-shi
Representative Masanori Komiya
Capital 7,000 million yen (plan)
Outstanding Share 600 (plan)
Shareholders' Equity 14,900 million yen (plan)
Total Assets 24,300 million yen (plan)
Financial Closing Date March 31
Number of Employees 250 (plan)
Principal Shareholders and Toshiba 51%
Shareholdings Samsung 49%
Relations with Separation Company HR: Separation Company dispatches directors and employees.
Business: Sales and procurement of products and materials
Note1: The New Company will get a capital increase from Samsung after the
corporate separation has been done.
Note2: The New Company will establish a new subsidiary in Korea that will
acquire the optical-disk-device business from Samsung.
6. Effects of business separation on Toshiba's financial results
(1) There is no change in trade name, principal lines of business, principal
office, representative, capital stock, total assets and financial closing date.
(2) No significant effect on Toshiba's operating results or financial
position is forecasted. The fiscal year 2004 forecast on consolidated and
non-consolidated basis after the business separation will be announced in the
end of April 2004.
Forward looking statement:
This contains forward-looking statements concerning Toshiba's future plans,
strategies and performance. These forward-looking statements are not historical
facts, rather they represent assumptions and believes based on economic,
financial and competitive data currently available. Furthermore, they are
subject to a number of risks and uncertainties that, without limitation, relate
to economic conditions, worldwide mega-competition in the electronic business,
customer demand, foreign currency exchange rates, tax rules, regulations and
other factors. Toshiba therefore wishes to caution readers that actual results
may differ materially from our expectations.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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