Date
23 June 2017
Terry Gou, founder and chairman of Foxconn, is putting together a consortium to bid for Toshiba's prized chip business. Photo: Reuters
Terry Gou, founder and chairman of Foxconn, is putting together a consortium to bid for Toshiba's prized chip business. Photo: Reuters

Foxconn says Apple, Dell joining bid for Toshiba chip business

Apple Inc. and computing giant Dell Inc will join a Foxconn-led consortium bidding for Toshiba Corp’s highly prized chip unit, the CEO of the world’s largest contract electronics manufacturer told Reuters.

Terry Gou, Foxconn’s founder and chief executive, said US-based Kingston Technology Co., a maker of memory products, would also be part of the bidding group, while Amazon.com Inc. was close to joining.

The Taiwanese firm is also in discussions with Alphabet Inc.’s Google, Microsoft Corp. and Cisco Systems Inc. about their participation in the bid, he said.

He declined to say how much Apple and other US firms planned to invest.

“I can tell you Apple is in for sure,” Gou said in an interview, adding that its participation had been approved by chief executive Tim Cook and Apple’s board of directors.

Asked about the total size of the Foxconn-led offer, he declined to give a figure, saying only that it was “very close” to other bids.

Toshiba is rushing to find a buyer for the world’s second-largest producer of NAND chips, which it values at US$18 billion or more, to cover billions of dollars in cost overruns at its now-bankrupt US nuclear business Westinghouse Electric Corp.

Foxconn, however, has not been seen as a frontrunner for the unit due to its deep ties with China, where it manufactures much of its products. The Japanese government has said it will block any deal that would risk the transfer of key chip technology out of the country.

Gou said that the Foxconn-led consortium contained no Chinese capital and had the advantage of not inviting as much antitrust scrutiny as other suitors. He also played down potential opposition from the Japanese government to the bid.

“The key is that we are all customers, we are users,” he said.

Foxconn, formally known as Hon Hai Precision Industry Co., and its Japanese unit Sharp Corp. would have a combined stake of not more than 40 percent, he added.

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