Investing.com – Japan Toshiba Corporation (T :) Stock prices soared to their highest levels in three years after the company announced plans to return to TSE 1, the first section of the Tokyo and Nagoya Stock Exchanges, after a long absence.
The company’s stock price surged 16.77% to ¥ 3,460 ($ 33.34) at 12:17 EST (5:17 GMT), the largest daytime rise since July 2017. ..
Toshiba reportedly set a transfer date on January 29, which means that its shares will be added to the market index, allowing domestic active funds to buy the shares. Atul Goyal, a senior analyst at Jeffreys (NYSE :), also reports the move as “cheap.”
Toshiba was demoted to the second part of two Japanese exchanges in August 2017, severely avoiding a complete delisting. A multi-billion dollar loss at the Westinghouse nuclear power plant in the United States caused debt to exceed asset levels and forced the sale of its semiconductor business. The company was also forced to inject cash from a significant number of activist shareholder delegations, and write-downs and accounting scandals appointed outsider Nobuaki Kurumatani as CEO.
Special situation analyst Travis Randy told Bloomberg that Toshiba’s return to TSE-1 will allow it to re-index in the market ending February 25. Randy also estimates that this inclusion will require a passive fund to buy 58 million shares, or 13% of the outstanding shares.
“Topix inclusions of this size are a rare species … activists who have been suffering for a long time may be pleased. This creates partial exit liquidity,” he added to the report.
The move will also occur in December after Kurumatani signals that Toshiba is more cautious and cautious than before, but is ready to pursue acquisitions and business expansion again. He also reaffirmed Toshiba’s intention to sell its stake in its former flash memory unit, Kioxia.
“One thing that has changed is that I’m currently in charge … The board also applies very strict standards to acquisitions. When it comes to transaction review and screening rigor, it’s a completely different company. That’s what Kurumatani told Bloomberg.
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Toshiba expects its share price to skyrocket by more than 16% in preparation for a TSE-1 return by Investing.com.
https://www.investing.com/news/toshiba-sees-shares-soar-over-16a-as-it-preps-tse1-return-2397354 Toshiba expects its share price to skyrocket by more than 16% in preparation for a TSE-1 return by Investing.com.