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Shares in Toshiba clawed some of their way back from a 12.3 per cent drop on Thursday after reports surfaced on the size of potential bids for a minority stake in its memory chip business.

The stock managed to regain some ground after an early afternoon drop as Reuters reported the Japanese industrial conglomerate had received an offer of as much as ¥400bn ($3.6bn) for a nearly 20 per cent stake in its memory chip business. Shares finished Thursday down 6.7 per cent at ¥225.5, pulling back from a low of ¥212.

Toshiba is known to have received bids from South Korea’s SK Hynix, Taiwan’s Foxconn, private equity fund Silver Lake and at least three other groups for a minority stake in its profitable memory chip business.

The spin-off of the company’s profitable memory chip unit comes as the company seeks cash to help it survive a coming multibillion-dollar writedown on its US nuclear business – the true scale of which is set to be revealed on February 14 when the company reports third-quarter earnings.

If the writedown erases Toshiba’s shareholder equity of $3bn, it could force the company to return a positive level of shareholder equity by the end of its financial year on March 31 or face a downgrade from the top section of the Tokyo Stock Exchange.

Copyright The Financial Times Limited 2017. All rights reserved.
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