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In the early 1980s, under the restrictions of "Batumi", Toshiba's top brass struggled to preserve the Soviet market. Later, Toshiba sent a group of senior staff to hold a cocktail party in Moscow, and then managed to obtain the order by making friends with Soviet government officials.
In this transaction, Toshiba sold four CNC machines for 3.5 billion yen. With the import of Japan's high-end machine tools, Soviet submarine and aircraft carrier thruster technology has advanced by leaps and bounds, and for the first time, the US Navy has lost its advantage in underwater acoustic detection of Soviet submarines.
However, paper can not contain the fire after all. In 1987, a letter of revelation from Toshiba exporting high-end machine tools to the Soviet Union was sent to Batumi. In the months that followed, after investigation and verification, the United States was indignant, repeatedly condemning Japan and imposing sanctions on Toshiba.
Then-Japanese Prime Minister Yasuhiro Nakasone had to apologize to the United States. At the same time, the Japanese side also spent 100 million yen to publish a full-page "confession advertisement" in more than 50 newspapers in the United States. This can be described as stealing chicken and not reversing the erosion of rice.
"Success is also the United States and the United States" is not an exaggeration to describe Toshiba. After being sanctioned for 3 years to ban exports to the United States, Toshiba continued to seek to transform into high-tech, but it did not expect to fall apart because of a merger and acquisition of A U.S. nuclear power company.
01 The Light of Japan
Historically, the Meiji Restoration was the starting point for Toshiba's rise. In the Meiji era, when learning From Western techniques and actively promoting modernization, the Japanese inventor Hisashi Tanaka founded an industrial manufacturing institute in Tokyo in 1875.
In 1904, Shibaura Manufacturing Co., Ltd. was established on the basis of this industrial manufacturing plant. In the early 1920s, Shibaura Manufacturing Co., Ltd. mainly supplied heavy mechanical and electrical manufacturing in Japan, and gradually grew into a well-known industrial factory.
Another source of Toshiba is the White Heat House, the first company in Japan to make white-hot electric bulb table lamps. In 1899, The White House was renamed Tokyo Electric. In 1939, Tokyo Electric and Shibaura Manufacturing Were formed to form "Tokyo Shibapu Electric Co., Ltd.", also known as "Toshiba".
Since then, with its strong research and development strength, Toshiba has created a number of "Japan firsts", including Japan's first radar, Japan's first transistor TV and microwave oven, the first color video telephone, the first Japanese word processor, the first laptop, the first DVD year and so on.
Especially in the field of home appliances, Toshiba became a pioneer in white goods. In the 1970s, home appliance business revenue accounted for 30% of Toshiba's total revenue, and Toshiba, Together with Sharp and Panasonic, was called the "Big Three" of Japanese white electricity.
In 1985, Toshiba developed the world's first laptop, the TOSHIBA T1100
By the end of the 1980s, Japan's economic bubble burst and stagnated, but Toshiba did not stop and transformed from a company with household appliances and heavy-duty motors as the main body to a comprehensive electronic and electrical company including communications and electronics.
Specifically, Toshiba's business covers a wide range of infrastructure, power generation, nuclear energy, home appliances, computers, manufacturing, semiconductors, etc., and has achieved one of the best performances in the world in many fields.
For example, with the support of the Japanese government, the Japanese semiconductor industry is booming, and Toshiba has become the world's leading semiconductor manufacturer in competition with American companies in the DRAM (Dynamic Random Access Memory) industry.
In terms of volume, Toshiba in its heyday was a giant with 180,000 employees, not only the world's top five semiconductor manufacturers, but also the world's top three medical device manufacturers, Japan's second largest integrated motor manufacturer, one of Japan's four major nuclear energy manufacturers, is an uncompromising "Japan Light".
02 Lay the "nuclear" mine
In the 1990s, Japan's economic bubble burst and entered a long period of downturn, known as the "lost 20 years". At the same time, China's home appliance companies began to impact Japanese companies.
In this regard, the response of Japanese companies is to gradually withdraw from the field of consumer goods and move to high-end materials and high-value components in the upstream of the industrial chain.
For example, Sony acquired a medical diagnostic equipment research and development company in the United States to expand the medical market; Hitachi has made efforts in power generation and power generation control systems, semiconductor production equipment, high-performance materials and other fields; kyocera has made efforts to build on thermistors and mobile phone components such as crystals and crystal oscillators.
In order to reduce its dependence on traditional businesses and develop high-tech industries, Toshiba management has set its sights on the nuclear power business. And of course, there are toshiba's strategic considerations behind this.
After entering the new century, with the continuous expansion of environmental pollution caused by coal burning and the reduction of non-renewable energy sources, nuclear energy has been favored by countries around the world. By 2006, a total of 222 nuclear power plants were under construction or proposed worldwide.
However, in the field of nuclear power, Hitachi and GM, Mitsubishi and France's Areva have all formed alliances, and Toshiba has no place. In view of this, it was not long before Toshiba was approved by Westinghouse Electric in the United States.
As the builder of most nuclear reactors in the United States, Westinghouse electric has participated in the bidding of China's third-generation nuclear power plant projects with the AP1000 third-generation pressurized water reactor technology.
Once Toshiba, which uses boiling water reactor technology, wins Westinghouse Electronics, it will not only have a more complete nuclear power technology system, but also get a ticket to enter China, the largest nuclear power market in the future.
So, in February 2006, after a fierce bidding, Toshiba beat a competitor to take a 77% stake in Westinghouse Electric, the largest subsidiary of the British Nuclear Fuel Company (BNFL).
Faced with malicious competition from GM and Japan's Mitsubishi, Toshiba spent three times the offer of Westinghouse Electric ($5.4 billion) to close the deal. But Toshiba President and CHIEF Executive Officer Atsushi Nishida was convinced that Westinghouse Electric would bring huge and long-term economic benefits to Toshiba.
With a global nuclear power dream, Toshiba won westinghouse at all costs. But what people did not expect was that it was this deal that reached a price of 3 times that dragged Toshiba into the quagmire of disaster.
03 The black swan has arrived
In 2008, the subprime mortgage crisis swept the world. As a result, Toshiba under Atsushi Nishida handed over the worst report card in history the following year, with a net profit deficit of 343.5 billion yen.
As a result, Atsushi Nishida retired from his position as president and took over the baton of Sasaki, who had been in charge of the nuclear power business. At the handover ceremony, Mr. Nishida commented that Sasaki was "a hero in bringing Toshiba's nuclear power business onto a global trajectory."
Apparently, Toshiba has high hopes for the nuclear power business and expects to receive orders for 39 nuclear reactor equipment worldwide in 2015. In fact, In 2009, Toshiba already had 12 orders in hand and is moving towards the desired goal.
But surprisingly, the black swan event suddenly arrived. On March 11, 2011, an earthquake measuring 9.0 on the Richter scale at 14:46 local time in Japan triggered a radioactive material leak at the Fukushima Daiichi Nuclear Power Plant.
The Fukushima nuclear power plant, which leaked, was built for Toshiba and completely shattered Toshiba's nuclear power dream.
After the Fukushima nuclear power plant incident, the pace of business development of nuclear power plants worldwide has plummeted. Among them, Toshiba has obtained 4 of the 8 nuclear power plants to be built in the United States, and other countries have also suspended plans for nuclear power plants.
In addition, of the 12 nuclear power plant construction plans signed by Toshiba in 2009, the remaining 8 singles have also postponed the construction progress. At the same time, Toshiba's Westinghouse Electric's construction of four nuclear power plants in China was also significantly delayed.
At that time, Toshiba revealed to the media that "the "Sanmen No. 1 machine" under construction in Zhejiang, China, has been three years later than the original scheduled operation, and the Sanmen No. 1 machine, which was supposed to start operation in November 2013, has not yet completed construction. ”
To make matters worse, the Chinese market, which took the lead in recovering after the trough, has an unprecedented level of emphasis on independent intellectual property rights. In view of this, the third generation of Westinghouse's technology has been introduced by the State Nuclear Power Corporation, a central enterprise under the State Power Investment Group of China.
It was also reported that after 2009, Toshiba's nuclear power division received only a few orders for nuclear power plants in India.
Overall, Toshiba has very few potential customers in the nuclear power sector, and the orders cannot be completed for profit, which leads to a bottomless pit.
04 Performance Thunderstorm
The nuclear power dream was completely shattered, and the pressure on Toshiba's performance also followed. As a result, the third generation of Toshiba presidents demanded an increase in the company's profits in the name of "meeting the challenges". But in the market environment at the time, this was an impossible task.
In response, Toshiba's management has a crooked idea to deal with the "challenge" through financial fraud.
There has been speculation that the powerful Atsushi Nishida is not satisfied with the business that Sasaki ran during his tenure, and Sasaki does not want to be blamed by Atsushi Nishida and asks for a false account. The cowardly and incompetent Hisao Tanaka, in the shadow of the dictatorial Sasaki, continued the practice of the previous two presidents.
Finally, in 2015, news of Toshiba's financial fraud was revealed, more of which were related to nuclear power.
In the seven years from 2008 to 2015, Toshiba misstated 224.8 billion yen (12 billion yuan) in pre-tax profits, according to to to Toshiba's disclosure. That's more than 30 percent of pre-tax profits over the past seven years.
In addition, according to Japanese media, The Westinghouse brand is overvalued by 200 billion yen.
On July 21, 2015, toshiba's three presidents, Atsushi Nishida, Sasaki, and Hisao Tanaka, bowed to the media in front of the long guns and short guns at the Toshiba Tokyo Headquarters Building and apologized to the public.
As soon as the news came out, Toshiba's stock price plummeted, the market value shrank by 40%, and President Hisao Tanaka and Vice Chairman Sasaki announced their resignations.
It can be said that the disclosure of financial fraud information is equivalent to negating Toshiba's development in the past 10 years, because Toshiba has achieved the best performance in the past decade between 2005 and 2010. The counterfeiting incident greatly damaged Toshiba's credibility.
According to reports, Toshiba's goodwill loss in 2016 was as high as US$6.1 billion, directly resulting in Toshiba's insolvent debt of 552.9 billion yen in 2016.
However, after the financial fraud was exposed, Toshiba did not cut westinghouse electric with a quick knife, but instead acquired the nuclear engineering business of the American Sibier company for $229 million through Westinghouse Electric, trying to make a large amount.
But after the acquisition was completed, Toshiba discovered that the business was saddled with $4.2 billion in debt. As a result, Toshiba's finances, which were already blood-deficient, became even bigger. In fiscal 2016, Toshiba's net loss was 965.7 billion yen (US$8.8 billion), the largest full-year loss in the history of Japanese manufacturing companies.
05 Struggle for redemption
Under the huge financial hole, Toshiba had to embark on the road of "selling property" to return to blood.
Among them, Toshiba sold Toshiba Living Appliances Co., Ltd., a major household appliance business, to Midea for 51.4 billion yen. At the same time, Midea has also obtained a 40-year global authorization from the Toshiba brand;
Toshiba Medical Systems, Toshiba Medical Devices, sold to Canon for 665.5 billion yen, and the image sensor business sold to Sony for 19 billion yen;
Toshiba also sold an 80.1 percent stake in the laptop business to Sharp for $36 million. In addition, Toshiba sold its semiconductor business to Bain Capital for $18 billion.
But it wasn't until 2018 that Toshiba sold Westinghouse to Brookfield Asset Management in Canada for $4.6 billion, thus getting rid of the burden.
After a series of firesal sales, Toshiba's operations have been shrinking, and sales are expected to be 3.5 trillion yen in 2021, less than half of the peak period. In view of this, foreign funds began to take advantage of the void.
On April 6, 2021, CVC Capital, a British private equity firm, uninvited, made an uninvited tender offer to Toshiba for a 30% premium of about US$21 billion. Toshiba's board then rejected the offer on the grounds of "lack of details."
Half a year later, in order to resist the "invasion" of foreign capital, Toshiba proposed to split the company into three companies according to its business, namely Infrastructure Service Co., Device Co., and Toshiba Asset Management Company.
But as soon as the plan came out, it was opposed by a number of foreign funds, including 3D Investment Partners.
Therefore, in February 2022, Toshiba announced a revised restructuring plan, changing the original one into three to one and dividing it into two. The new proposal is for two independent new companies, one to focus on the electronic equipment business, and the other to remain at the head office, operating infrastructure services such as Toshiba power generation equipment. And this includes many compromises with foreign shareholders.
In fact, in all of Toshiba's businesses, semiconductor components are more competitive and can obtain higher benefits. And this part is also the content that foreign capital has been coveting for a long time.
Today, today, to the fragmented Toshiba Semiconductor has limited additional investment in equipment and research and development. As for the future viability, it may not take much time for Toshiba Semiconductor to once again become a small dish on the dinner plate of other funds.
epilogue
Throughout Toshiba's nearly four decades of history, black swan events such as U.S. sanctions, economic bubbles, subprime mortgage crises, and the Fukushima nuclear power plant leak have occurred frequently, making people lament that Toshiba is unlucky.
However, in this process, it is also necessary to examine the lack of foresight and crisis awareness of Toshiba's management in terms of strategic direction, capital and technology investment, and personnel management. There are also many human disasters in Toshiba's decline.
It can be said that Toshiba's problems mainly lie in the nuclear power strategy. First of all, Nishida's determination to acquire Westinghouse Electric put Toshiba with an extremely heavy burden, and then Toshiba executives began to try to escape the disaster by using accounting fraud.
But in fact, the paper wrapper can not hold the fire, and the counterfeit Toshiba has gone to an accelerated decline. This allowed foreign funds to take advantage of the void, which in turn led to Toshiba's current implementation of a split in two. As the former "light of Japan", Toshiba, Toshiba is now falling to the point of "separating the family" to resist foreign invasion, which is inevitable to make people sigh. After the former giants were split, it may be very difficult to bridge them again.
If World War II was the defeat of the Japanese nation, it is Toshiba that is in decline due to nuclear power. Although Japan later revived, the Japanese media mostly believed that Toshiba would not be able to rise again. The decline of Toshiba also means that Japan's decades-long "integrated motor company" business model has basically come to an end.
In the new economy of the world, focus on a certain area and make this business bigger and stronger or a new trend.
(Proofreading/Hidden Dracy)