Toshiba Memory rebrands as Kioxia but embraces parent’s heritage

Toshiba’s spun-off memory chip business will shed the name of the 144-year old Japanese conglomerate as it prepares to navigate “a very uncertain environment” that has been escalated by the recent diplomatic spat between Japan and South Korea.

The name change to Kioxia — a play on the Japanese word for memory and the Greek word for value — comes as the timing of its initial public offering has been clouded by the volatility in memory chip prices in the wake of Tokyo’s sanctions against Seoul on crucial supplies for the semiconductor industry, and the US-China trade dispute. 

The move also marks a new chapter for Toshiba Memory, which had long been the crown jewel of the Japanese group until it was sold last year to a consortium led by Bain Capital in a landmark $18bn deal to stave off a financial crisis. 

“There is more event risk out there than any of us are used to,” Stacy Smith, a former chief financial officer at Intel who was appointed chairman of Toshiba Memory in October, said in an interview.

“As an independent company, the leadership team here is much more focused on external market forces and moving fast to react to changing conditions.” 

Memory chip prices have soared over the past week as political tensions escalated between Tokyo and Seoul. The bump follows a collapse in chip prices from the second half of last year as a decline in demand for smartphones and computers led to a glut in supply. 

Despite earlier market speculation that Toshiba Memory, the world’s second-largest producer of flash memory chips after Samsung Electronics of South Korea, would go public before the year end, people close to the company said the timing was now unclear due to market uncertainty caused by the erosion of global sentiment caused by the US-China trade war. 

Mr Smith said underlying drivers for data demand remained intact in the new era of smart factories, autonomous vehicles and the internet of things. But he said the name change was unrelated to the company’s plan to go public and declined to comment on the timing of the IPO.

“We are not giving up our Toshiba heritage but we’re building on it,” Mr Smith said. “It’s meant to mark . . . a new era of memory and a new start for us as an independent company.” 

Toshiba Memory is also open to acquisition opportunities in next-generation technology and other areas as it competes against global rivals such as Samsung and Micron of the US. 

“There is no sense within the company that we’re stepping away from being Japanese,” Mr Smith said, adding: “We have to be globally competitive. That’s one of the areas we’re focusing on and making sure that we make the appropriate investments.”