Renowned camera manufacturer Canon finalised the deal Thursday to purchase Toshiba Medical Systems Corporation (TMSC) for ¥688 billion ($6.1 billion). The companies had entered into an exclusive agreement to negotiate the final terms of the acquisition last week after Canon outbid other suitors in the deal.
According to a Wall Street Journal report, Canon has already paid ¥655.5 billion ($5.9 billion) to Toshiba in cash and the remaining ¥22.5 billion (over $200 million) would be paid later. The deal is subject to antitrust validations in related countries, and a Canon spokesman said the company had no timeline of when the process would be completed.
"TMSC is one of the leading global companies in the medical equipment industry. Within the field of medical X-ray computed tomography (CT) systems in particular, TMSC is the overwhelming market share leader in Japan and has been steadily increasing its global market share, [sic]" the Financial Times quoted a Canon spokesman as saying. "By maximizing the combination of both companies' management resources, Canon aims to solidify its business foundation for health care that can contribute to the world. [sic]"
Canon, which has limited presence in the healthcare sector and makes X-ray machines and eye examination devices, has been trying to foray deep into the medical equipment field, and the latest acquisition would give the camera-maker a much-needed boost in the ecosystem.
Separately, Toshiba would also benefit from the deal, as the funds would fulfil its financial necessities as it has been planning to seek about $1.8 billion in loans from various banks, according to Reuters.
Toshiba is expecting massive losses, up to ¥710 billion ($6.3 billion), in the fiscal year ending March, which is the highest estimated figure in the company's 140-year corporate history.
In a separate report Thursday, Toshiba said it plans to invest ¥360 billion ($3.2 billion) to set up a new semiconductor manufacturing unit in Japan. The company is trying to focus the nuclear power and flash memory chips, its core business areas. Bloomberg also reported that the company's shares took a plunge with reports of the U.S. Department of Justice and the Securities and Exchange Commission investigating Toshiba's accounting scandal.
Toshiba's stock fell 8 percent to ¥192 in Tokyo Thursday afternoon.