TOKYO, April 12 Western Digital Corp has
warned Toshiba Corp that splitting off its chip unit
prior to a planned sale of the business violates their joint
chip venture contract.
Western Digital, which operates a chip plant with Toshiba in
Japan, said the split-off is "very serious breach of joint
venture agreements," according to a letter sent by the
California-based company to Toshiba and seen by Reuters.
The objection is likely to complicate the sale of the prized
unit - the world's second-biggest producer of NAND chips which
Toshiba has valued at around $18 billion.
Toshiba, which expects to book an annual net loss of 1
trillion yen ($9 billion) for this business year on a writedown
at nuclear unit Westinghouse, has said it is selling most or
even all of the chip business to help cover the charges and
create a buffer for future losses that threaten the
(Reporting by Makiko Yamazaki; Editing by Edwina Gibbs)