Toshiba Corp. said Monday it plans to sell shares in its semiconductor affiliate and return around half of the proceeds to shareholders as it focuses more on stable infrastructure services.
Toshiba, which currently has a 40.2 percent stake in Kioxia Holdings Corp., formerly called Toshiba Memory Holdings Corp., plans to sell the shares after the affiliate goes public, expected by the end of this year.
"Toshiba has no strategic intention to remain in the memory business," Toshiba CEO Nobuaki Kurumatani told an online press conference. "We are looking for ways to monetize our stake in Kioxia and once such a monetization is completed, we intend to return a majority portion of the net proceeds to shareholders, who have supported us."
"Toshiba will seek to further grow the infrastructure service and data services businesses," he said.
The planned sale of Kioxia shares comes as Toshiba continues to rigorously promote steps to streamline operations, selling its U.S. liquefied natural gas business and liquidating its British nuclear plant construction project.
Toshiba sold the crown-jewel former chip subsidiary to a consortium led by U.S. private equity fund Bain Capital for about ¥2 trillion ($18 billion) in June 2018 to rehabilitate from serious financial difficulties.
Kioxia, the world's second-largest producer of flash memory chips after Samsung Electronics Co., aims to make its initial public offering this year after dropping its original 2019 target due to poor earnings amid sagging demand for semiconductors, sources close to the matter have said.
Toshiba also said Mitsubishi Chemical Holdings Corp. Chairman Yoshimitsu Kobayashi will retire as chairman of the board after taking the post to strengthen governance in September 2015, when the company was hit by an accounting scandal.
Kobayashi is formally set to be replaced by Osamu Nagayama, honorary chairman at Chugai Pharmaceutical Co. following a general shareholders meeting on July 31.