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Toshiba to shed troubled assets, cut jobs; shares jump nearly 12 percent

Reuters  |  TOKYO 

(Reuters) - Corp said it is liquidating its British nuclear power unit and selling its U.S. business, in an effort to shed troubled assets that could have exposed the Japanese company to future losses.

The plans are part of a new five-year strategy announced on Thursday, which also included more than 2,000 job cuts.

shares surged as much as 11.8 percent to near two-year highs after the announcement.

The decisions come as the company struggles to find new growth pillars after the sale of its prized memory chip unit earlier this year left it with low-margin businesses.

Toshiba sold the world's No. 2 memory chip to a consortium led by U.S. private equity firm to recover from years of financial trouble brought about by accounting scandals and cost-overruns at its now-bankrupt U.S. nuclear unit

The decision to liquidate the nuclear power unit, NuGen, would be a blow to Britain's plans to build a nuclear plant that was meant to provide 7 percent of the country's

Toshiba said it will announce the buyer of the project when it signs a contract for the deal.

The Nikkei reported earlier that Chinese firm was chosen as the buyer of the project.

The deal calls for ENN to take over Toshiba's 20-year use-or-pay commitment at Freeport export terminal in Texas, the Nikkei said.

When contacted by Reuters, an ENN Ecological said it was not aware of the deal at this time.

Toshiba cut its annual operating profit forecast to 60 billion yen from the previous estimate of 70 billion yen.

It also said it would repurchase its own shares worth up to 700 billion yen, starting Friday.

(Reporting by Makiko Yamazaki; Additional reporting by in Beijing; Editing by Muralikumar Anantharaman)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, November 08 2018. 09:46 IST
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