Last week Japan’s Toshiba Corp. made an announcement that its U.S. nuclear unit, Westinghouse Electric Co., has filed for bankruptcy protection. Various media reports say the filing was an attempt at restructuring Toshiba’s finances and hopefully getting out of the red ink.
“Toshiba said in a statement that it filed the Chapter 11 petition in the U.S. Bankruptcy Court of New York. The move had been largely expected,” an article in the New Jersey Herald reads.
Toshiba acquired Westinghouse in 2006. The company is expecting a loss of about $4.3 billion (in American dollars) from April to December of 2016, and $6.2 billion from Westinghouse. The numbers could reach a whopping $9 billion loss for the company’s fiscal year.
Read more: Bankruptcy Lawyer, Hamilton Township NJ
Costs of the business have ballooned due to growing safety concerns and regulations, along with a dislike of nuclear power in some countries, like Germany.
“Toshiba has been eager to get Westinghouse off its books to improve its plight, and it said it would do just that from this fiscal year. It has said earlier it wants to sell Westinghouse. Toshiba said Westinghouse had racked up debt of $9.8 billion,” the newspaper reports.
Toshiba President Satoshi Tsunakawa told media the move was aimed at “shutting out risks from the overseas nuclear business.”
Toshiba plans to monitor the rehabilitation proceedings and disclose information as quickly as possible. Its chairman has taken responsibility for the company’s financial troubles.
“The company has said it will no longer take on new reactor construction projects and will focus on maintaining the reactors it already has,” the article reads. “But it is also involved in the decommissioning of the Fukushima Dai-ichi nuclear plant, which suffered multiple meltdowns after the March 2011 tsunami.”
Toshiba has reportedly sold off so many parts of its operations, it has little left but its infrastructure business.
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