Toshiba is reportedly planning to cut 4,000 jobs in Japan as the automotive giant undergoes restructuring
Toshiba announced its plan to trim nearly 4,000 jobs within Japan as part of its restructuring efforts, following its delisting in December. This move comes after a $13 billion acquisition led by a consortium spearheaded by Japan Industrial Partners (JIP), marking the end of a turbulent decade marred by scandals within the company.
As per a report by Reuters, this attempt by the consortium to turnaround Toshiba is considered a trial for private equity in Japan, a sector once known as "hagetaka" or vultures. The automobile major said that the company is planning to move its office operations from central Tokyo to Kawasaki. It is also aiming to achieve a 10 per cent operating profit margin within three years.
In Japan's conservative business space, companies that are looking to divest non-core assets or are facing succession challenges are now increasingly reaching out to PE firms.
It is worth noting that several companies, such as photocopier manufacturer Konica Minolta, cosmetics giant Shiseido, and electronics firm Omron, have recently announced job cuts.
Last year, Toshiba's removal from the Tokyo Stock Exchange on December 20 marked the culmination of its 74-year history as a publicly traded company. Before the acquisition by JIP took place, the automaker had witnessed eight years of turmoil, which included an accounting fraud scandal, financial difficulties, the sale of assets, and intense clashes between management and activist investors.
The recent layoffs come at a time when various companies have announced massive job cuts. In the automobile space, big players like Tesla and Ford had also resorted to layoffs to streamline operations.