Chinese officials have finally approved the sale of a majority stake in Toshiba’s huge microchip business to a group led by an American investment firm, the Japanese company said on Thursday.
The move could be a significant peace offering by the Chinese government to the Trump administration as the two sides negotiate to ease a trade dispute. Lack of approval by Chinese regulators has long held up the deal — a delay widely believed to be a signal from Beijing of ways it could punish American businesses if the Trump administration carried through with threats to impose tariffs on $150 billion in Chinese-made goods.
In a statement on Thursday, Toshiba said it had received “all required antitrust approvals” for the deal with a consortium led by the American investment firm Bain Capital.
Chinese officials could not be reached for comment late Thursday, and its official media and websites were silent on the matter. The reasons for the approval, and for the long delay to begin with, were not immediately clear.
Bain Capital also did not immediately comment.
Still, the approval will be seen as a positive sign by the Trump administration, and it suggests the two sides are looking for ways to defuse tensions and reach a deal. A senior Chinese government official, Liu He, is in Washington this week for trade talks.
The approval of the Toshiba deal comes just days after the White House appeared to make its own peace offering to Beijing.
President Trump, in a surprise tweet on Sunday, said he had asked American officials to find a way to help ZTE, a Chinese telecommunications company. Officials in Washington last month prohibited United States companies from selling much-needed technology to ZTE to punish the Chinese company for violating American sanctions against selling goods made in the United States to Iran, North Korea and other countries. ZTE’s factories ground to a halt, spurring anger from Beijing.
China’s approval raises questions about another big deal before antitrust regulators: Qualcomm’s $44 billion purchase of NXP Semiconductors, a company based in the Netherlands. That deal has also been long delayed pending Chinese approval, stirring speculation that Beijing was looking for ways to warn Washington of the potential consequences for a full-blown trade war.
The Toshiba deal’s approval will most likely be a big relief for the Japanese conglomerate, which once symbolized the country’s technological might but more recently has been scrambling to survive.
After months of difficult negotiations, Toshiba reached a deal in September to sell most of its lucrative microchip business to a group led by Bain Capital. The deal would give Toshiba $14 billion in cash it desperately needs after a bad bet on nuclear power. Toshiba officials could not be reached for comment late Thursday.
The Toshiba chip business had been one of the company’s crown jewels. It makes a type of microchip, called NAND flash memory, that cellphones and digital devices use to store data. The business is profitable and attracted considerable interest from buyers.
Bain and Toshiba are not Chinese companies, but antitrust regulators in China still have considerable say over whether the deal goes through. Like American and European regulators, Chinese antimonopoly officials can punish foreign companies through fines or other measures if they believe a deal beyond’s China’s borders will give the new business too much market power.
China has been flexing those relatively new regulatory muscles in recent years as it becomes a major consumer of the world’s goods.