Toshiba which presented high-end TVs and laptops to the millions of people in the world is fighting with a financial crisis. Toshiba declared that by the end of March its loss reached to 1 trillion yen and it seems impossible for it to stay in business.
Being the icon of Japanese industry, Japan does not seem to let it to collapse. Toshiba has more than 190.000 employees in various industries around the world and more than 100,000 them are in Japan. Bankruptcy of Toshiba will cause an extreme global economic crisis.
The bankruptcy Toshiba’s partner Westinghouse Electric in the nuclear construction sector deeply boosted the collapse of Toshiba. But, Toshiba still has a significant nuclear business in Japan. It does decommissioning work at the Fukushima Daiichi plant, where a nuclear disaster had occurred after the powerful earthquake and tsunami in 2011.
It is known that Japanese government has decisions to save major companies that are in trouble. And, it is obvious that Toshiba is too big for Japan to allow it to go under.
The situation is still changeable. Despite the efforts of Japanese Government, if the banks stop supporting Toshiba, it may not survive. But the lenders so far appear willing to hold out for a solution rather than risk losses of their own from a messy collapse.
On the stock market, investors have been trying to get rid of the shares of Toshiba. Its stock has more than halved in value after the collapse of Westinghouse Electric last December.
Satoshi Tsunakawa, the CEO of the company stated that the company is working to sell an additional 160 billion yen ($1.5 billion) worth of assets to help give it a sufficient financial foundation. Analysts have no idea about what kind of company will be left after all shedding of all those businesses.
Toshiba says it will now focus on its social infrastructure business meaning transportation systems and products like air-conditioning units and elevators. The collapse of this iconic 142-year-old company will deepen the current economic crisis in the world and will cause a wave of crisis and collapse of the related companies and sectors.