(Bloomberg) -- Toshiba Corp. got regulatory approval from China for the sale of its memory chip business, clearing the way for the 2 trillion yen ($18 billion) deal with a group led by Bain Capital.
The sale of the semiconductor business will take place on June 1 after approval was gained from all necessary regulators, the Tokyo-based company said in a statement Thursday. The deal had already missed earlier deadlines for clearance as the companies waited on Chinese antitrust authorities to make a decision.
“We are making this important investment because we see the opportunity to further grow Toshiba Memory Corporation,” Bain Capital said in a statement. “This transaction will help ensure a competitive global semiconductor market and protect the supply chain from potential disruption.”
Toshiba shares were little changed in Tokyo Friday and have dropped about 4 percent this year.
Toshiba, which invented NAND chip technology, put the business up for sale more than a year ago as it sought to repair a balance sheet hammered by billions of dollars worth of losses from a push into nuclear energy. Bain’s group includes SK Hynix Inc., Apple Inc., Hoya Corp. and Seagate Technology Plc with Toshiba to retain a stake in the business.
China’s approval was needed because the country is the biggest market for chips. Officials at the Ministry of Commerce were concerned Hynix may end up with a significant stake in Toshiba’s chip business, consolidating power among the top players, people familiar with the matter have said.
The Bain approval comes just days after China is said to have resumed considering Qualcomm Inc.’s bid for NXP Semiconductors NV.
While the chip unit sale was designed to avoid a delisting from the Tokyo stock exchange, Toshiba’s finances have recovered since it was first proposed. The company boosted its capital with a 410 billion yen nuclear asset sale and 600 billion yen of new stock in December.
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