Toshiba and Canon in Negotiations for Sale of Toshiba Medical Systems

March 9, 2016—Toshiba Corporation announced that the company has granted exclusive negotiation rights to Canon Inc. regarding the sale of Toshiba Medical Systems Corporation (TMSC).

According to the company, the Toshiba Rebuilding Initiative, which was announced on December 21, 2015, included the decision to invite a third party, or parties, to become the majority shareholder(s) in TMSC, in order to ensure future provision of sufficient support and resources for the health care business to maximize value and realize its full potential, and to improve Toshiba’s financial strength. Toshiba then carried out procedures to execute the sale of TMSC, and, at the meeting of the board of directors on March 9^th, decided to grant exclusive rights to negotiate the sale of TMSC to Canon.

Toshiba advised that it has carried out a close evaluation of the overall proposals received from companies that expressed an interest in acquiring TMSC, including their appraisals of TMSC’s value and the feasibility of successfully completing the transaction, and determined that the proposal from Canon was superior to that of the other companies.

The effective period for the exclusive negotiating rights extends to March 18, 2016. Toshiba will continue discussions with Canon Inc. during that period to reach a final agreement, stated the company.

According to a report in The Wall Street Journal, the transaction is estimated to be valued at approximately $6.2 billion, "Signifying a major bet by Canon, known for its cameras and printers, that medical equipment would be a growth business." TMSC's products include x-ray systems, computed tomography scanners, and magnetic resonance imaging systems, noted The Wall Street Journal report.