Toshiba is considering an IPO of its memory chip business despite already agreeing to sell the unit to Bain Capital for $18bn (£13bn), according to the Financial Times.
The deal with Bain Capital is awaiting anti-trust approval by the end of March, but if the deal fails to clear, the vendor is giving thought to floating the business instead.
The Financial Times also reported that some analysts and Toshiba shareholders even favour the IPO proposal over the existing deal. The IPO approach is considered one of many contingency plans if the sale fails to progress.
"An IPO would be a better option for Toshiba," Damian Thong, Macquarie analyst, told the Financial Times. "They would capture value that they are giving up to Bain. The deal was done when Toshiba's bargaining position was weak, but their circumstances are different now."
While the sale to the Bain-led consortium would be the biggest private equity deal in Japan, it was signed last year as part of emergency efforts to shore up Toshiba's balance sheet, claimed the Financial Times.
An equity issuance, which followed an upgrade of Toshiba's status by the Tokyo Stock Exchange, has since dramatically improved the company's finances.
The deal with Bain still needs approval from a series of anti-trust regulators around the world by the 31 March deadline. While it is expected to get approval, there is a strong chance the Chinese regulator will not make the deadline.
The Financial Times report added that analysts say there is a 20 per cent chance the Bain deal will not go through. However, even if the March deadline is missed, an extension until June is still possible.
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