The letter highlights the shareholders’ unease about Toshiba’s split proposal and raises the possibility that the split plan may be difficult to obtain approval at the general meeting of shareholders early next year.
A Toshiba spokesperson said the company will not comment on shareholder private transactions. 3D declined to comment.
3D stated in the letter that the possibility of a spin-off to solve Toshiba’s current problems is slim. On the contrary, it is very likely that three under-performing companies will emerge, reproducing the situation of Toshiba today.
Some other hedge fund shareholders also said they were disappointed by Toshiba’s refusal to privatize.
3D stated in the letter that Toshiba should start a formal process to develop a convincing plan for each business, provide detailed due diligence materials to interested financial and strategic parties, and hold management meetings to encourage and promote All parties make recommendations and evaluate the best path forward.
After Toshiba broke the scandal that its management was suspected of colluding with the Japanese Ministry of Trade to exert pressure on foreign shareholders, it initiated a strategic evaluation under pressure from investors.
During the five-month evaluation, Toshiba’s evaluation committee held talks with six private equity firms, including KKR & Co (KKR.US) and Brookfield (BAM.US), to seek solutions including privatization. Strategic thinking.
Although the review committee has never conducted due diligence on a possible sale, it said that negotiations with private equity firms have shown that potential offers are unattractive relative to market expectations.
The review committee composed of five outside directors stated that it had not received any proposal to privatize the company. The company said that the idea of privatization has caused concerns within Toshiba.
However, in its letter to the review committee, 3D criticized the committee for failing to solicit advice on the sale of Toshiba or the disposal of part of its business.