Oct 23, 2017 Last Updated 22:11 PM EDT

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Toshiba chair quits hours after conglomerate reveals $3.4 billion loss

Feb 15, 2017 01:08 AM EST

Toshiba International Corporation
(Photo : Toshiba) The 1,000,000 square-foot Toshiba International Corporation, one of Toshiba’s premiere manufacturing bases in North America.

The chair of Japanese multinational conglomerate, Toshiba, has stepped down hours after the company reported a multi-billion-dollar loss.

Shigenori Shiga, Toshiba chair, quit hours after the company revealed a net loss of ‎¥390 billion ($3.4 billion) in the year to March 2017.

The company earlier stated its third quarter earnings, due on Feb. 14, "has not become available" and would be delayed and asked Japanese regulators to extend a noon reporting deadline for a month. It later announced, however, it was set to post a multi-million-dollar net loss. According to CNBC, the company has received nod to submit the report by March 14.

Toshiba has also stated it expected to take a ‎¥712.5 billion ($6.3 billion) write-down at its US nuclear business, according to a report on BBC. The report further mentioned Shiga stepped down "to take management responsibility for the loss," the company said.

Shares slipped by as much as nine percent on Tuesday and have lost about 50 percent since late December.

The firm's losses have been linked to a deal conducted by its US subsidiary, Westinghouse Electric Company, when it purchased a nuclear construction and services business from CB&I Stone & Webster last year.

Part of the delay in reporting the company's official financial statements, Toshiba stated, was because it needed additional time for lawyers to study that acquisition. Toshiba's auditors had determined after the deal that Westinghouse overpaid.

According to reports, the Japanese conglomerate had given the nod to Westinghouse's purchase of CB&I Stone & Webster hoping the contractor's operations would be integrated with its own.

Jasper Koll, CEO of WisdomTree Japan KK, stated in the CNBC report that the era of the great industrial conglomerates is basically over. "Do I think that Toshiba is going to survive? Personally I'm prepared to bet that they will," but, he said, it would probably be a completely different company in one to two years' time.

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