Toshiba in Mtron Capital

Toshiba is participating in the capital increase with consideration for MTRON.
 
According to the Financial Supervisory Committee, Toshiba decided to participate in the capital increase with consideration by third-party share allotment worth KRW 27 billion on May 28th, and acquire new shares worth KRW 5 billion. As a result, Toshiba will hold 698,324 MTRON shares.

Since Toshiba and MTRON entered into an MOU for equity investment on the 15th of last month, they have been conducting due diligence. After this due diligence, Toshiba decided to invest in MTRON equities.

"As Toshiba becomes a shareholder, MTRON’s effort to make inroads into the global market will be given further impetus," said an MTRON official. "On the basis of our strategic alliance with Toshiba, we are planning to establish a comprehensive strategy covering mutual technology development and marketing.”

MTRON is known to have the world’s best technology in the SSD (Solid State Drive) sector. SSD is the next-generation storage device based on flash memory.

Recently it is attracting the attention of semiconductor makers around the world so much that Samsung Electronics also regards the SSD as the next-generation strategic product, but Toshiba is known to have failed to secure enough SSD technology in relative terms.

Accordingly, it is construed as Toshiba’s intention to further consolidate its strategic alliance with MTRON by acquiring equities of MTRON with proven technical know-how in the SSD sector.

"Even though the SSD market is still in its infancy, the hard disk drive cannot but be gradually replaced by the SSD after all," said an MTRON official. "Cooperation with Toshiba will help us firmly establishing MTRON as a leader in the SSD market."

The payment for stock purchase, which has been a drag on its stock price, is now over with.

Also, with the capital increase with consideration in which Toshiba participated, MTRON is now able to take care of the payment for stock purchase that has been applying a downward pressure on its stock price.

At the end of last year MTRON (called Digital First at that time) merged with its affiliate MTRON, and triggered a sharp decline in stock prices, and consequently ended up having to pay as much as KRW 32.6 billion to meet the claim for stock purchase.

MTRON had a difficulty raising the necessary funds. It postponed payment of the money to meet the claim for stock purchase several times. In this process the stock price fell a great deal as well.

"MTRON is now able to take care of the money necessary to meet the claim for stock purchase with the KRW 27 billion it raised through the capital increase with consideration involving Toshiba, and its internal funds," said an MTRON official. "As a result the biggest uncertainty of the company has been cleared."