Toshiba expects a Hefty Write Down on Nuclear Plants

Japan’s Toshiba Corp. said this morning that it may book a goodwill impairment write down of several hundreds of billions yen. This comes thanks to its US nuclear power acquisition made by its Westinghouse division. This sent shares of the already scandal ridden tech giant down by 12 percent.

In a statement, made earlier today, Toshiba did not specify a figure. Potential losses range from ¥100 billion to ¥500 billion.

This loss would be another blow to the sprawling technology giant that is trying to recover from a $1.3 billion accounting scandal and another write down of $2 billion of its nuclear business, made earlier this year.

Toshiba will hold a board meeting later this evening to discuss the matter.

The Westinghouse Division to bear the brunt for Toshiba

The potential loss relates to their Westinghouse division and Chicago Pride & Iron (CB&I) nuclear construction firm. Westinghouse acquired this business last year for $229 million.

The firms have fought over calculations for working capital and who should assume potential liabilities towards cost overruns. CB&I has sued Westinghouse after claiming it was owed more than $2 billion.

Shares of Toshiba were crushed by the late morning tumbling over 12 percent after being down more than 16 percent at one point.

Toshiba, who has a new CEO Satoshi Tsunakawa, has positioned its nuclear and semiconductor businesses as key pillars of growth. They are also looking to scale down its less profitable consumer electronics units like computers and televisions.

Any big loss, taken now, will force the company to increase its already weakened financial base. This base has been pummeled by ongoing restructuring in wake of a massive accounting scandal.