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ECONOMY

Westinghouse to file for Chapter 11 bankruptcy today

  • March 28, 2017
  • , Asahi, Mainichi, Yomiuri, Nikkei, Sankei
  • JMH Summary

Most papers claimed that Westinghouse is likely to file for Chapter 11 bankruptcy on Tuesday (U.S. time), with Yomiuri explaining that the U.S. nuclear plant manufacturer will seek bankruptcy protection before Toshiba convenes a stockholders’ meeting on Thursday so as to allow the Japanese conglomerate to explain to its stakeholders how it plans to deal with the Westinghouse failure. The electronics giant reportedly believes that it has become necessary to swiftly file for bankruptcy in order to elicit shareholders’ consent at the Thursday meeting for its business restructuring plans, including the sale of its flash memory operation. According to Asahi, Toshiba will bear 300 billion yen in additional losses as a result of the bankruptcy filing, while Nikkei said the Japanese firm is committed to guaranteeing almost 800 billion yen of Westinghouse debt. Nikkei also said it is critical for Toshiba and the GOJ to address the Trump administration’s concerns about the fate of Westinghouse.

 

Noting that Toshiba is seeking assistance from the Korean Electric Power Group as a sponsor for the post-Chapter 11 reorganization of Westinghouse, several papers speculated that the Korean firm will be reluctant to accept the request in part because of political instability at home. Asahi wrote that while Toshiba plans to hold an auction tomorrow for its semiconductor division, it has already turned down possible bids by Chinese funds based on the assessment that the GOJ will probably invoke statutory authority to block the sale of the unit to a Chinese entity due to national security considerations.   

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