Sumitomo Mitsui Banking Corp and four other Japanese banks plan to lend a total of about 1.2 trillion yen to a domestic mutual fund to help it buy up Toshiba Corp, a source familiar with the matter said on Thursday.
Japan Industrial Partners Inc has already secured an investment offer worth about 1 trillion yen from a group of more than 10 Japanese companies including Orix Corp. The acquisition of the embattled conglomerate is expected to be between 2.2 trillion yen and 2.5 trillion yen.
Japan Industrial Partners is leading a consortium that has identified Toshiba as the preferred bidder for the potential acquisition. His plan to rebuild the conglomerate hinges on privatizing it.
The five banks planning the loans totaling 1.2 trillion yen are SMBC, Mizuho Bank, Sumitomo Mitsui Trust Bank, MUFG Bank and Aozora Bank, according to the source. They aim to complete the credit plan by the end of the year.
In early October, Toshiba selected the consortium as the preferred bidder to Japan Investment Corp, a government-backed fund that plans to partner with Bain Capital on the acquisition.
Toshiba is struggling to recover from problems like a storefront scandal and a massive loss at its US nuclear power business that surfaced in the 2010s.