Western Digital’s SanDisk Subsidiaries Initiate Arbitration with Toshiba in International Chamber of Commerce Related to NA...
May 14 2017 - 05:46PM
Business Wire
Arbitration is in Response to Toshiba’s
Purported Transfer of its JV Interests to Toshiba Memory without
Consent and Planned Sale to a Third Party
Western Digital Continues to Believe that it
is the Best Partner to Advance Toshiba’s Legacy of Technology
Innovation in Japan
Western Digital Corp. (NASDAQ:WDC) today announced that several
of its SanDisk subsidiaries have filed a Request for Arbitration
with the ICC International Court of Arbitration related to three
NAND flash-memory joint ventures (“the Flash JVs”) operated with
Toshiba Corporation (“Toshiba”).
The arbitration demand seeks among other things an order
requiring Toshiba to unwind the transfer to Toshiba Memory, and
injunctive relief preventing Toshiba from further breaching the
Flash JV agreements by transferring its Flash JV interests, or any
interest in an affiliate that holds its Flash JV interests, without
SanDisk’s consent. Per the provisions of the joint venture
agreements, the arbitration will take place in San Francisco,
California.
Western Digital chief executive officer Steve Milligan stated,
“The Flash JVs have been operated with Toshiba for the past 17
years and have been highly successful for the JV partners and for
Japan. We continue to be actively engaged in discussions with
Toshiba’s stakeholders to ensure that they are fully aware of our
joint venture rights and of our desire to work with Toshiba to
achieve a favorable outcome for all parties. We firmly believe that
we provide Toshiba with the optimal solution to address its
challenges, and that we are the best partner to advance its legacy
of technology innovation in Japan.”
Milligan added, “Joint ventures are inherently intimate
commercial relationships, and in order to protect against being
forced into such a relationship with parties not of their choosing,
SanDisk and Toshiba agreed to protect their interests in the joint
ventures by prohibiting transfers without the consent of the other
party. Toshiba’s attempt to spin out its joint venture interests
into an affiliate and then sell that affiliate is explicitly
prohibited without SanDisk’s consent. Seeking relief through
mandatory arbitration was not our first choice in trying to resolve
this matter. However, all of our other efforts to achieve a
resolution to date have been unsuccessful, and so we believe legal
action is now a necessary next step. We are confident in our
ability to protect our rights and interests and to improve our
value creation opportunities.”
On or around April 1, 2017, Toshiba purportedly transferred its
joint venture interests to a subsidiary, Toshiba Memory, as part of
an open auction to sell its joint venture interests to a third
party. Western Digital believes that these actions clearly violate
the anti-transfer provisions of the joint venture agreements. Under
the joint venture agreements, these transfers require SanDisk’s
consent. SanDisk did not consent to the transfer to Toshiba Memory,
and Toshiba has now repudiated any intention to obtain SanDisk’s
consent before selling Toshiba Memory to the winning bidder of the
auction.
About Western Digital
Western Digital is an industry-leading provider of storage
technologies and solutions that enable people to create, leverage,
experience and preserve data. The company addresses ever-changing
market needs by providing a full portfolio of compelling,
high-quality storage solutions with customer-focused innovation,
high efficiency, flexibility and speed. Our products are marketed
under the HGST, SanDisk and WD brands to OEMs, distributors,
resellers, cloud infrastructure providers and consumers. Financial
and investor information is available on the company's Investor
Relations website at investor.wdc.com.
Forward-Looking Statements
This news release contains certain forward-looking statements,
including statements concerning the Flash JVs, SanDisk’s rights
under the joint venture agreements and SanDisk’s actions in
response to Toshiba’s transfer of its Flash JV interests. There are
a number of risks and uncertainties that may cause these
forward-looking statements to be inaccurate including, among
others: uncertainties with respect to the company's business
ventures with Toshiba; volatility in global economic conditions;
business conditions and growth in the storage ecosystem; impact of
competitive products and pricing; market acceptance and cost of
commodity materials and specialized product components; actions by
competitors; unexpected advances in competing technologies; our
development and introduction of products based on new technologies
and expansion into new data storage markets; risks associated with
acquisitions, mergers and joint ventures; difficulties or delays in
manufacturing; and other risks and uncertainties listed in the
company's filings with the Securities and Exchange Commission (the
"SEC"), including the company's Form 10-Q filed with the SEC on May
8, 2017, to which your attention is directed. You should not place
undue reliance on these forward-looking statements, which speak
only as of the date hereof, and the company undertakes no
obligation to update these forward-looking statements to reflect
subsequent events or circumstances.
Western Digital, WD and SanDisk are registered trademarks or
trademarks of Western Digital Corporation or its affiliates in the
U.S. and/or other countries. Other trademarks, registered
trademarks, and/or service marks, indicated or otherwise, are the
property of their respective owners. © 2017 Western Digital
Corporation or its affiliates. All rights reserved.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170514005050/en/
Western Digital Corp.Media Contact:Jim Pascoe,
408-717-6999jim.pascoe@wdc.comorInvestor Contact:Bob Blair,
949-672-7834robert.blair@wdc.comorJoele Frank, Wilkinson Brimmer
KatcherEric Brielmann / Jed Repko / Ed Trissel415-869-3950 /
212-355-4449wdcmedia@joelefrank.com
Western Digital (NASDAQ:WDC)
Historical Stock Chart
From Feb 2024 to Mar 2024
Western Digital (NASDAQ:WDC)
Historical Stock Chart
From Mar 2023 to Mar 2024