News Mar 20, 2017 08:55 AM EDT

Japanese minister agrees to contribute information on developments with Toshiba

By April Kirstin Chua

Japan's industry minister has agreed with the US energy and commerce secretaries on Thursday to contribute valued information regarding developments with Toshiba Corp and its plagued US nuclear partner, Westinghouse Electric Co, according to Japan's Kyodo news agency.

The company was considering the sale of its unit, last Tuesday, to delve into problems that caused it to miss an earnings deadline for the second time.

Toshiba believes it could find potential buyers for a majority stake in Westinghouse but evades questions regarding a Chapter 11 bankruptcy filing for the unit.

The Japan-based group optimistically looks on various strategic options, however, sources familiar with the matter says Toshiba has hired bankruptcy lawyers as an exploratory step. Hiroshige Seko, minister of economy, trade and industry in Japan, has told reporters that he had agreed with US Energy Secretary Rick Perry and Commerce Secretary Wilbur Ross' plans and looks forward to sharing information about the developments of the case.

Accordingly, Seko says that together with the US Cabinet members they considered the fiscal stability of Toshiba as very important. He also had a separate meeting on Thursday with Gary Cohn, the director of the White House National Economic Council. A White House official says that the Westinghouse subject was talked about in the meeting and that both sides are monitoring it closely. Meanwhile, the US Commerce and Energy departments and the National Economic Council refuse to respond to further comments.

The Westinghouse sale represents the latest in a series of steps Toshiba plans on undertaking to deal with the losses coming from the nuclear unit's ill-fated purchase of a US nuclear power plant construction company in 2015. Toshiba has already put up almost all its memory chip business for sale to cope up with the upcoming $6.3 billion markdowns for the nuclear business and to create a buffer for potential losses in the future.

Westinghouse has been afflicted by huge cost overruns at two US projects in Georgia and South Carolina. The unit's liabilities related to the projects only mean that it is unlikely to be an easy asset to sell regardless of its attractive technology. It has also been negotiating with a multi-billion-dollar deal to build six nuclear reactors in India after a 2008 civil nuclear accord that was supposed to demonstrate a new era of economic and strategic cooperation between the United States and India.

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