Fund to Field Toshiba Slate -- WSJ
By Patrick Thomas
New York-based hedge fund King Street Capital Management LP said it intends to nominate a slate of independent directors to replace a majority of Toshiba Corp.'s board.
The Wall Street Journal reported last year that King Street, one of Toshiba's largest shareholders, intended to shake up the Japanese industrial conglomerate's board.
A Toshiba spokeswoman declined to comment on the King Street announcement.
The hedge fund, which has a 5.4% stake in Toshiba, said its board slate will include King Street co-founder Brian Higgins.
"The current directors have done a commendable job navigating the company through the last several years, and we thank them for their service," King Street said in a letter to Toshiba's chief executive and chairman. "Now, however, a different type of board is needed to lead its turnaround plan."
King Street said in its letter that it has identified a number of qualified candidates and will propose a specific slate of directors in a timely manner. King Street said Toshiba needs to re-examine its business portfolio and evaluate underperforming businesses and assets.
Toshiba has been through a tumultuous period since an accounting scandal unfolded in 2015 and it suffered losses when its U.S. nuclear subsidiary, Westinghouse Electric Co. filed for bankruptcy protection in 2017.
Since its accounting issues, Toshiba has restructured its board by reducing the number of directors and boosting the number of outsiders. Seven of its 12 directors are independent.
In April of last year, former banker Nobuaki Kurumatani took over as Toshiba's chief executive. In an interview with The Wall Street Journal in November, he said Toshiba no longer sees itself as a company selling to consumers because that business isn't profitable enough.
Known for consumer products such as televisions and notebook computers, Toshiba has sold many of those operations.
The Tokyo conglomerate currently manufactures hard-disk drives, printers, and wireless communications products, in addition to a range of equipment for industrial customers.
Write to Patrick Thomas at Patrick.Thomas@wsj.com