Another attempt is underway to resolve the future ownership of Kioxia.

Kioxia is 40% owned by Toshiba and 56% owned by Bain Capital which paid Toshiba $18 billion for its 56% stake.

Western Digital (WD)  jointly owns some Japanese NAND production facilities in a jv with Kioxia from which Kioxia and Western Digital share the output 50-50.

A proposal earlier this year was that WD would spin off its flash business and merge it with Kioxia, creating a publicly traded company in the US managed by Western Digital.

A later  alternative proposal was that WD  would own slightly more than 50% of the merged entity but Kioxia execs would run it. Under this proposal, WD-Kioxia would be initially listed on the Nasdaq  with a Tokyo listing later on. Bain would receive  a special dividend either in cash or shares.

 Under the latest reported plan,  Kioxia and WD’s memory business would be folded under a single holding company in which Kioxia would own 63% and WD 37%, based on enterprise value. 

After a capital adjustment, the final split would be 50.1% for the WD side and 49.9% for Kioxia, say Nikkei sources but Yahoo sources say kioxia would have a 43% stake with WD having 37% stake. 

Kioxia President Nobuo Hayasaka would become president of the combined company, and Kioxia representatives would constitute a majority of the board.

The new company would be registered in the U.S., while its head office would be located in Japan. It would aim to list on Nasdaq and the Tokyo Stock Exchange.

The financials are unusual. Toshiba’s market cap is currently $13.3 billion, WD’s market cap is $14.8  billion and Kioxia is said to be worth anything between $20 and $28 billion.

In August 2022, Western Digital made an all-share offer worth $20 billion for Kioxia which was $7 billion more than WD’s then market cap of $13 billion.

What may make the negotiations futile is that China will probably veto any deal.