Toshiba set to separate and sell partial stake in chip operations

Japanese tech company Toshiba has announced that it will split its smartphone chip operations up from its core business, as well as selling a stake in the new business.

It has been reported that 20% of the new business will be sold off, following financial difficulties for the firm surrounding a heavy loss for its nuclear power business.

Toshiba's chip business is worth an estimated $9bn, second only to Samsung in terms of size globally.

According to reports, potential buyers of a stake in the new business include Canon, Western Digital and the Development Bank of Japan.

The company has been in a downward spiral since the end of 2016, falling more than 45% after a botched deal with US subsidiary Westinghouse Electric. The dispute centres around the subsidiary's purchase of nuclear construction firm Chicago Bridge & Iron, with its assets thought to be worth less thann originally expect.

The company's former chief executive Hisao Tanaka resigned in 2015 over similar accounting problems.

"We had been thinking of splitting off semiconductors to beef up our finances, and the recent nuclear write-down risk accelerated the discussion," said current chief executive, Satoshi Tsunakawa, at a news conference Friday.