JIP Struggling to Obtain Loans for Toshiba Acquisition

Economy

Tokyo, Jan. 20 (Jiji Press)--Japan Industrial Partners Inc. is struggling to obtain agreement from a bank syndicate on expected loans to finance the investment fund’s planned acquisition of Toshiba Corp. <6502>, sources have said.

JIP, the preferred bidder for the electronics and heavy machinery giant, is negotiating with the group of five Japanese banks, hoping to secure up to 1.4 trillion yen in loans by the end of January.

The two sides are still apart over financial covenants on conditions the borrower must fulfill if Toshiba’s financial health deteriorates again, the sources said.

The acquisition of Toshiba is estimated to cost 2.2 trillion yen.

Of the amount, JIP plans to procure 1 trillion yen in investments from about 20 companies including leasing company Orix Corp. <8591>, semiconductor maker Rohm Co. <6963> and Chubu Electric Power Co. <9502>.

[Copyright The Jiji Press, Ltd.]

Jiji Press