Toshiba to give Western digital chip sale notice

TOKYO • Western Digital Corp said it will move forward with arbitration to get a say over Toshiba Corp’s sale of its chip unit after the Japanese company agreed to provide notice before closing.

The companies announced last Friday they’d reached an agreement providing for two weeks’ advance notice.

The two manufacturers, which are in a joint venture (JV) to produce memory chips, submitted the agreement to a San Francisco state judge who had proposed it two weeks ago.

The relationship between the two companies has deteriorated as Toshiba moves to complete the sale of the flash-memory division by March. Western Digital has sought to block the deal on concerns the chip unit may end up with competitors.

Last Friday’s agreement protects Western Digital from a hurried transaction, but Toshiba may prevail in arbitration and divest the unit anyway.

Western Digital and Toshiba became partners when the US company bought SanDisk Corp last year, inheriting that chipmaker’s relationship.

“Our goal has always been to protect and preserve the health and future of our successful JVs,” Western Digital said in a statement last Friday. “Our ongoing discussions with Toshiba and its stakeholders have been constructive, and we will continue to work to seek a solution that is in the best interests of all parties.”

Toshiba said the agreement won’t get in the way of it pursuing a sale. — Bloomberg