Bain and JIP consortiums lead the way in acquiring Toshiba

The field of bidders vying to buy Toshiba has narrowed to two frontrunners, a consortium led by US private equity group Bain Capital and another led by a , according to three people familiar with the matter Japanese Domestic Fund.

The sale of the 146-year-old industrial conglomerate was subjected to an extensive due diligence process in a bidding round that began in spring and is expected to last until November. A deal for Toshiba could be worth as much as $22 billion for one of Japan’s best-known companies.

Private equity group Japan Industrial Partners, which previously acquired assets from Sony and Olympus, has been given preferred status in the second round of bids but has not signed an exclusivity agreement, two of the people said.

In addition to the groups around Bain and JIP, the US private equity group Brookfield and the European buyout firm CVC, whose original $20 billion proposal for Toshiba in 2021 forced the resignation of the then president and the current one, also made it bidding war triggered, round to second place.

Toshiba has evolved into a sprawling collection of subsidiaries and non-core assets, some listed separately, but many remaining as potential targets for future sell-offs. The due diligence process has provided bidders with vast data collections and factory access that is normally off-limits to investors.

The progress of the sale process has given the second round bidders unprecedented access to one of Japan’s most complex corporate groups.

JIP is in talks with a number of Japanese companies, including Chubu Electric and financial services group Orix, as well as private equity groups, but consortium members and financing details aren’t finalized, according to these people.

Another person with direct knowledge of the talks questioned whether the JIP-led consortium was able to offer the most competitive prices.

JIP declined to comment. Orix said it was considering an investment in Toshiba, but added that no decision had been made yet. Chubu Electric said it signed a non-disclosure agreement with Toshiba and another investment fund, which it declined to name.

JIP initially partnered with Japan Investment Corp, an investment fund backed by the Japanese government, in the first round of bidding. But the two have since parted ways, with JIC now in talks with Bain Capital, which was seen as the front runner in the bidding war.

JIC and Bain declined to comment.

In a statement, Toshiba declined to comment on the bidders, saying it could “undermine a fair process”.