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One of Toshiba Corp.’s largest investors is calling on the conglomerate to run a strategic review after private equity firm CVC Capital Partners proposed taking the company private for $21 billion (¥2.3 trillion).

3D Investment Partners, which owns a 7.2% stake in Toshiba, said in a letter to the company’s board that it believes running a full and fair sales process was essential to rebuilding trust with investors after a tumultuous period that has included an investor revolt and the resignation of former CVC dealmaker Nobuaki Kurumatani as chief executive officer.

"To conduct a fair and proper process, Toshiba should explicitly indicate that it is open to alternative ownership structures and correct media speculation that Toshiba’s management team and board have a strong preference for remaining a listed company,” 3D Investment said in the letter, a copy of which was obtained by Bloomberg.

3D Investment said its view is the fair value of Toshiba exceeds ¥6,500 per share, but that it should run a full sales process in order to determine the company’s valuation. The investment firm said it was disappointed Toshiba’s chairman didn’t respond to a previous request to run a review.

The stock has seen large swings since the CVC proposal, with the shares closing as high as ¥4,895 on April 15, before falling in the past week to ¥4,410 at Friday’s close.

If the company fails to run an auction, 3D Investment, the third-largest Toshiba investor, is prepared to either campaign to vote against the company’s board nominees at this year’s annual general meeting or call for a shareholder meeting to replace directors, according to a person familiar with the matter.

CVC first approached the company earlier this month about potentially taking the company private. It reiterated its interest in a letter on April 18, saying that while it was not prepared to go hostile, it remained interested in acquiring the company.

The firm said it would "step aside” while Toshiba prioritizes its communication with shareholders after the management change but was prepared to reengage when the company was ready.

CVC has informal financing commitments from banks and has been continuing talks with potential partners including Bain Capital, people with knowledge of the matter said. Citigroup Inc. is advising CVC, according to the people, who asked not to be identified because the information is private.

CVC, Citigroup and Bain representatives declined to comment. Toshiba wasn’t immediately available for comment.

Toshiba said in a statement that CVC’s proposal lacks the required information and the board determined "it is not possible to evaluate it.”

3D Investment said Toshiba’s board had an obligation to investors to explore any bona fide interest in the company, and that doing so would be consistent with its duties to good governance and an important first step in rebuilding trust with shareholders.

It said it believed Toshiba is at "an important crossroad” with the recent resignation of its CEO, the expressions of interest from private equity suitors, and the ongoing process for maximization and distribution of the value of its stake in memory-chip business Kioxia Holdings Corp.

"Our firm is focused on enabling Toshiba to realize its enormous potential for all stakeholders,” 3D Investment said, including the consideration of a new ownership structure. "If the board cannot demonstrate that it has objectively and properly considered this question, public shareholders will have no choice but to seek a more significant and ongoing role in governance.”

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