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Asia Today ISSN 1861-4604 Monday, February 19, 2018

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Toshiba selling medical and consumer-electronics units

Sold to Japanese camera maker Canon

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TOKYO - Japanese conglomerate Toshiba Corp. is selling its medical and consumer-electronics units in order to raise cash to help fund restructuring after a massive accounting scandal.> Big News Network

The Japanese electronics maker sold its medical unit to Japanese camera maker Canon Inc. for 665.5 billion yen ($5.9 billion) on Thursday.

Separately, Toshiba said it has struck a deal to sell a controlling stake in its so-called "white goods" and consumer-electronics arm, Toshiba Lifestyle Products and Services Corp., to Midea Group Co., a Chinese maker of low-cost appliances.

Pricing and stakes being sold under the deal, expected to be completed by the end of the month, have not been decided, company spokeswoman Midori Hara said.

Toshiba saw its shares slide following a report that US authorities were investigating accounting related to its Westinghouse nuclear power unit.

Toshiba has been struggling with a major scandal following revelations that company officials doctored accounting books for years after setting unrealistic earnings targets.

Canon, which has been awarded exclusive negotiating rights to acquire Toshiba Medical Systems Corporation (TMSC) in early March, said in a statement:

"TMSC is one of the leading global companies in the medical equipment industry. Within the field of medical X-ray computed tomography (CT) systems in particular, TMSC is the overwhelming market share leader in Japan and has been steadily increasing its global market share

By maximizing the combination of both companies' management resources, Canon aims to solidify its business foundation for health care that can contribute to the world."

However, Canon added that the transaction was "conditional upon the clearance of necessary competition regulatory authorities".

Canon has been striving to expand in high-margin medical devices as demand for cameras has declined with the advent of smartphones.

Canon won the bidding race against Fujifilm Holdings Corp., another camera maker.

The sale is structured to give Toshiba immediate cash before the end of its fiscal year on March 31, though Canon can't take full control until antitrust authorities approve the deal, likely in the new fiscal year.

Toshiba Chief Executive Masashi Muromachi, who has already announced more than 10,000 jobs cuts, is due to unveil a new business strategy on Friday.

For the fiscal year through March, the company is forecasting a 710 billion yen ($6.3 billion) loss, even bigger than its initial projection and the biggest in its 140-year history.It will be the company's second year of red ink.

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