Yesterday Patently Apple posted a report titled "A Last Minute Twist may have the Bain/SK Hynix/Apple bid the Winner for Toshiba's Chip Business." Today Toshiba announced that the company has entered into a memorandum of understanding (MoU) with Bain Capital Private Equity, the lead member of a consortium currently bidding to acquire Toshiba Memory (TMC), memorializing the parties' intent to negotiate a mutually satisfactory definitive agreement for the sale of TMC by the end of this month. 

The decision to enter into the MoU was made by Toshiba's board of directors at its meeting on September 13. The signing of this MoU does not eliminate the possibility of negotiations with other consortia, Toshiba said.

Toshiba indicated it has been in continuing negotiations with three consortia of potential purchasers of TMC: a consortium that includes the Innovation Network Corporation of Japan, Bain and Development Bank of Japan; a consortium that includes Western Digital; and a consortium that includes Hon Hai. In the course of these negotiations Bain has come forward with a new proposal. Toshiba's board of directors has determined to continue negotiations with the Bain-led consortium on the basis of this new proposal, and the company will work to expedite the conclusion of a stock purchase agreement by the end of September.

"Toshiba intends to reach a definitive agreement that fully meets our objectives at the earliest possible date," said Yasuo Naruke, senior executive VP of Toshiba. "The sale of TMC must promote further growth of TMC's memory business, and return Toshiba group to positive equity."

Western Digital has issued a statement commenting on Toshiba's announced MoU with the Bain Capital-led consortium. "We are disappointed that Toshiba would take this action despite Western Digital's tireless efforts to reach a resolution that is in the best interests of all stakeholders."

"It is surprising that Toshiba would continue to pursue a transaction with a consortium led by Korea-based SK Hynix and Bain Capital Japan without SanDisk's consent, as the language in the relevant JV agreements is unambiguous, and multiple courts have ruled in favor of protecting SanDisk's contractual rights. We remain confident in our ability to protect our JV interests and consent rights."

Western Digital added its arbitration requests filed in May and July, 2017 continue to move forward in the ICC International Court of Arbitration.

Lastly, Dr. Yasuo Naruke, Senior Executive Vice President of Toshiba stated: "The memory business is highly time sensitive. It requires timely investments, accelerated product development, and the ability to quickly ramp-up large scale production capacity. TMC is now proceeding with a unilateral investment in manufacturing equipment for the Fab 6 clean room at its Yokkaichi Operations, and we aim to increase the output of 3D Flash memory at Yokkaichi to approximately 90% of capacity in FY2018. Moving forward, we will continue to make timely investments to expand operations to meet the growing market demand."

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Related: September 9, 2017: The Bain, SK Hynix, Apple bid for Toshiba has been upped to $22 Billion as Decision Time Draws Nigh