The Strategist

Toshiba leaves US LNG market

09/02/2019 - 10:12

The company’s US division was bought by the French Total for $ 15 million.

FuFu Wolf
FuFu Wolf
Japanese Toshiba left its American LNG business. The company completed sale of its Toshiba America LNG division to the French Total. The deal amounted to $ 15 million.

The decisive factor for the conglomerate in favor of selling the American asset was a sharp drop in prices for liquefied natural gas in Asia. At the same time, Toshiba just headed for business optimization and disposal of non-core assets.

At the same time, as a result of the transaction, Toshiba’s losses this year will be about 90 billion yen ($ 847 million). For the most part, these will be Total payments on previously concluded contracts.

Since 2017, the Japanese conglomerate has been struggling with a crisis that erupted against the backdrop of the bankruptcy of its American unit Westinghouse Electric. Toshiba’s new management unveiled a five-year strategy to minimize losses. Getting rid of non-core assets, the company is restructuring its business amid a continuing decline in profits.

As part of the implementation of the strategy, the Japanese conglomerate has already announced liquidation of its British division, which was supposed to build a nuclear power plant in the United Kingdom. The company tried to sell this unit, but negotiations with potential buyers were unsuccessful.