3D Investment Partners, one of Toshiba’s largest shareholders, has sent a letter to the Strategic Review Committee (the SRC) and the Board of Directors (the Board) of Toshiba Corporation (Toshiba or the Company) (6502.T).
In the letter, 3D indicates that it believes the SRC’s review of strategic alternatives was incomplete and inadequate and calls upon the SRC and the Board to perform a fully informed, objective review of all of Toshiba’s strategic alternatives.
3D noted that it does not believe that the SRC’s plan to split Toshiba into three different companies is optimal or likely to create value for Toshiba’s shareholders.
3D writes: “We believe that significant change is required at Toshiba. For too long, Toshiba has suffered from failures of execution and misallocation of capital. Its corporate culture, misalignment with shareholders, and corporate governance have destroyed value and left Toshiba weak. These issues have been compounded, in our view, by a series of actions and statements from the legacy Board and executives that lacked transparency and damaged the credibility of the Company with its stakeholders.
“To create value, Toshiba should focus its capital and best people on its market leading franchises, while allowing its non-core or less successful businesses to be owned by others who, through strategic relationships or financial flexibility, can create value from those businesses. Retaining all or most of Toshiba’s businesses, and merely shuffling them into separate legal entities, does none of the hard work of sifting the core businesses from the non-core businesses and ensuring the core businesses are operated well, capitalised properly or governed effectively.
“We thus believe the SRC’s process and conclusions were lacking.”
