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Toshiba shares post biggest intraday loss on fears of huge loss at nuclear unit

Toshiba Shares Went Into Freefall On Thursday, With The Embattled Stock Down By Nearly Half Since Late December On Concerns About Huge Losses At Its Nuclear Power Business In The United States.

PTI | Updated on: 19 Jan 2017, 03:04:12 PM
Toshiba shares post biggest intraday loss on fears of huge loss at nuclear unit

Tokyo :

Toshiba shares went into freefall on Thursday, with the embattled stock down by nearly half since late December on concerns about huge losses at its nuclear power business in the United States.

The Tokyo-listed shares dived 16 per cent to end the day at 242.3 yen after Japanese media said the vast conglomerate could book losses of as much as 700 billion yen (USD 6.1billion) in the US unit.

The stock fell as much as 26 per cent earlier in the day,its biggest intraday decline in more than four decades,according to Bloomberg. The eye-popping loss would force the company, which has been struggling to move past an embarrassing accounting scandal, to seek support from a government-backed lender, the Nikkei newspaper said.

Toshiba, one of Japan's best-known firms, said exact figures were not finalised.

"We are still discussing how to deal with this issue, and no concrete decisions have been made," it said in a statement. Toshiba has fallen more than 45 per cent since the company, which makes everything from nuclear reactors to laptops, warned in late December of a possible one-time loss on its US nuclear business.

It said costs linked to the acquisition last year by its US subsidiary Westinghouse of a nuclear services company could come to "several billion US dollars" and dent its earnings. Japan's public broadcaster NHK said today Toshiba had drafted a plan to sell more assets and delay expensive plans such as layoffs to boost its coffers by about 300 billion yen.

Toshiba might spin off its semiconductor operations into a separate firm, among other efforts, in a bid to shore up its finances, NHK and the Nikkei said.

Toshiba said that splitting its memory chip business was an option, but that no conclusion had been reached. "There is a bigger sense of crisis than you would have imagined even a week ago," said Damian Thong, an analyst atMacquarie Group.

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First Published : 19 Jan 2017, 02:59:00 PM