Toshiba sees power chips as immediate growth driver after $14 billion buyout

TOKYO (Reuters) – Toshiba (OTC:) Corp sees power management chips as an immediate profit driver on the back of surging electric vehicle (EV) demand, its chief executive said on Friday, as the Japanese industrial conglomerate was taken private.

“We want to expand (production) capacity for power chips as quickly as possible,” Chief Executive Taro Shimada told a press conference held to mark the completion of a $14 billion buyout by private equity firm Japan Industrial Partners (JIP).

Toshiba plans to spend 125 billion yen ($175.57 million) to more than double power chip production, aiming to catch up with power chip giants such as Infineon (OTC:) Technologies AG.

“We will make optimal resource allocation to growth areas and potential profit both in Japan and overseas,” he said, adding that the company aims to quickly achieve a return on sales of 10% or more.

When asked about the possibility of restructuring and selling unprofitable businesses, Shimada said nothing had been decided. He also declined to comment on the time frame for a potential relisting of shares, saying it would be up to JIP to decide.

($1 = 142.3900 yen)