Sony, Carlyle Group, KKR among bidders for Toshiba's imaging unit, expected to fetch $3B+

Infinix-i X-ray angiography system--Courtesy of Toshiba

Toshiba appears on track to earn more than $3 billion from the sale of its medical device unit to help it recover from an accounting scandal, as the list of companies bidding on Toshiba Medical Systems grows, just prior to the Friday deadline.

Reuters reports that Konica Minolta is making joint bid with investment firm Permira, as are Sony ($SNE) and private equity player Carlyle Group, while fellow PE giant KKR ($KKR) is allying with Mitsui. Other potential bidders are Bain Capital, government-owned State Bank of Japan and Fujifilm, according to the article. And Canon CFO Toshizo Tanaka told investors that his company was also interested in Toshiba Medical Systems.

Toshiba's annual report for FY 2014 ending March 2015 shows that the Healthcare Systems & Services unit posted an operating income of ¥23.9 billion ($198.9 million), on net sales of ¥412.5 billion ($3.4 billion). Net sales grew marginally year-over-year, while operating income fell by about 25%, or ¥6 billion ($0.72 million).

Toshiba Medical Systems consists of imaging devices for CT scans, MRIs, ultrasounds and X-rays according to the company website. It leads the Japanese market with a 30% share, and is fourth worldwide, with a global market share of 10%.

In a letter on the company website, the Toshiba CEO Shuzo Yamamoto wrote that inviting outside investment by majority shareholders will allow Toshiba Medical Systems to make "timely strategic investments that would lead to higher growth."

The company will sell at least 51% of Toshiba Medical Systems. According to Reuters, the second round of bidding will determine the size of the stake to be sold.

A cash infusion from the sale of its medical equipment unit would help struggling Toshiba recover from a devastating accounting scandal. It forecasts a ¥550 billion ($4.6 billion) annual loss due in part to restructuring costs.

Multiple outlets report that Toshiba just demanded ¥3.2 billion ($27 million) in damages from 5 former seniors for their role in the accounting scandal, which is causing the conglomerate to consider selling off businesses as well.

- read Reuters' article | more from Reuters

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