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June 13, 2018, 8:49 a.m. EDT

Toshiba plans biggest Japanese market buyback on record

Conglomerate says it will buy back more than $6 billion worth of shares

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By Kosaku Narioka

Chief Executive Nobuaki Kurumatani, who took the job earlier this year, is facing his first annual meeting on June 27. He said that even after the buyback the company would have a healthy level of capital.

TOKYO—Toshiba Corp. said it planned to buy back shares worth about ¥700 billion ($6.3 billion), the largest buyback from the market on record in Japan, appealing to foreign shareholders who took a big stake last year.

Toshiba /zigman2/quotes/204149068/composite TOSYY +0.24%   shares rose 6.6% Wednesday on the news. The company will use proceeds from an $18 billion deal to sell its flash-memory unit to a consortium led by Bain Capital, which closed June 1.

Foreign funds such as Third Point LLC and Greenlight Capital Inc. have taken a growing role at the Japanese conglomerate since it raised ¥600 billion last December to bolster its balance sheet. At the time, it wasn’t clear whether it could complete the chip-unit sale, and the company needed to bolster its capital to avoid de-listing at the Tokyo Stock Exchange.

Now Toshiba’s finances are more stable, and with Wednesday’s share-price rise, foreign investors who took part in the capital raising are sitting on a 28% gain. Foreign shareholders accounted for 72% of total shares at Toshiba as of March 31, according to the company.

An expanded version of this report appears on WSJ.com .

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US : U.S.: OTC
$ 16.81
+0.04 +0.24%
Volume: 50,042
March 31, 2023 3:45p
P/E Ratio
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Market Cap
$14.45 billion
Rev. per Employee

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