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Toshiba’s Westinghouse Electric Files for Bankruptcy Protection

Great news another Japan giant go burst. Japan is going from bad to worst.
So many bad news coming from our Eastern neighbors these days. I would hate to be in the position of the Japanese stuck with nuclear disaster, or the South Koreans facing constant threats from the North. Recent government turmoil, Lotte & Samsung bad publicity, Park corruption scandals are just adding more flavors. On the other hand the Dragon is going fierce :flame:
 
heh, it had the same logo...

yep, some still use it.
58601-westinghouse-lcd1.jpg


0.jpg

old CBS logo

I know that the Merchant Bank is privately owned, but did it get any bailout yet?

No you didn't....and yes they are on the list of bailouts. I suggest you just keep quiet and not paint yourself into a corner more. Just let it go.
 
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People should also aware the concept of Bankruptcy in the US is probably different than the rest of the world. Chapter 11 especially is not very common on other country (such as UK, Canada, or Hong Kong)

In the US, if you file a Chapter 11 Bankruptcy, your business is entering a court appointed reorganizational stage, and at this stage, you (the owner of the company) is still in charge, you are free to run your business, but your creditor cannot recover the cost nor liquidate your asset. (Hence it was called Bankruptcy Protection)

Liquidation and Reform is allowed, however at Owner's own accord. It is different than Bankruptcy law in the commonwealth or other country is that this stage would have been represented in the commonwealth by a appointed administrator and the owner have to relinquished all the control of a company, and then try to locate a buyer and or reform company operation. And if this is still not been able to turn around, then the administrator can liquidate the company and recovering the asset as per creditor request. This cannot be done under Chapter 11 of the US Bankruptcy code tho. This is done by Chapter 7 in which you or your creditor can file to liquidate your asset.

Chapter 11 is not common (although also not uncommon, especially with larger business) and it has and have been abused by almost any big CEO in the US (I honestly can't think of any CEO in the US had not filed for Chapter 11) POTUS Donald Trump had filed 5 Chapter 11 in his career. It has been abused quite often to get more time to get your company back in shape and most likely company that file chapter 11 can make the reform, either by itself or by government interject.

It's when they have to file Chapter 7, that's where you start getting concern

Huh, good to know. I didn't realize the difference before this.
 
I was not aware what they actually did , and they did not bother to setup anything in Pakistan when they could have taken advantage of favorable condition for power generation
 
In US, if a top bank screws up, it is deemed too big to fail. No problem, it will be bailed out by the government at taxpayers' expense. Worse still, the CEO will get a big bonus running into hundred million dollars. (This was what happened after the GFC).

Plus, in the US, if you fail repeatedly, they may even make you the president.

Failing is good for the rich.

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Toshiba approves bankruptcy filing in US
E-mail Xinhua, March 29, 2017

Toshiba Corp. on Wednesday approved a Chapter 11 bankruptcy filing in the United States by its embattled Westinghouse Electric unit as the conglomerate is facing a possible 712.5 billion yen (US$6.4 billion) writedown on its failing nuclear energy business and a group net loss of more than 1 trillion yen.

The latest move follows Toshiba saying last month that it was expecting to write down 712.5 billion yen in losses connected to its nuclear power business with massive deficits attributed to Westinghouse for project delays and negative profit outlooks, as well as dwindling scope for future nuclear business operations.

The bankruptcy filing will potentially allow Toshiba to limit the risk of further deficits and the losses to date will be finalized by the end of the current fiscal year on Friday.

Toshiba acquired Westinghouse in 2006 in a deal worth 5.4 billion U.S. dollars at a time when the U.S. government had unrolled a number of allowances to support nuclear developers.

But increasing costs for reactors and more stringent safety standards added to Westinghouses difficulties, leading to Toshiba trying to mitigate the damages with the Japanese conglomerate opting to spin-off its top-earning flash memory business in a bid to make up for huge losses and free up funds.

Toshiba at the time said it would sell a stake of less than 20 percent in its flash memory business to ensure its liabilities do not exceed its assets in the current business year.

Toshiba's shares being placed on a "securities on alert" watchlist by the Tokyo bourse in September 2015, following an accounting scandal, which had initially dented the company's reputation, prior to the huge impairment costs, did little to help the firm's unfolding difficulties.

Toshiba's involvement in one of Japan's largest-ever accounting scandals also did little to help the trouble-hit conglomerate.

Between 2008 and 2014 the multinational conglomerate was involved in padding its profits by 152 billion yen, leading to its chief, and half of its board resigning. The firm was subsequently fined an unprecedented 60 million U.S. dollars.

Adding to its woes, Toshiba, this year, had to delay the announcement of its earnings report twice, stating that it needed more time to investigate an accounting issue at Westinghouse.

While the firm's NAND-type flash memory business has become a global industry standard, with the memory devices, produced locally, used in technology such as smartphones around the world and estimated to be worth 2 trillion yen, it's nuclear business has failed in a number of areas, both at home and abroad.

Particularly in the wake of the 2011 Fukushima nuclear crisis, Toshiba has been struggling to secure new orders.

Conversely, Toshiba's chip operation booked an operating profit of 110 billion yen on sales of 845.60 billion yen in the fiscal year that ended March 2016. This was at a time when the overall conglomerate logged a group operating loss of 708.74 billion yen.

Toshiba said due to its U.S. nuclear business-related losses, it now expects negative net worth of 620 billion yen at the end of March and a group net loss of 1.01 trillion yen following the bankruptcy filing.
 
still not a good thing, a powerhouse and well known name like Westinghouse shouldn't be filing for chapter 11. Imagine Elon musk file for chapter 11 for tesla, it would tank his stocks.

Well, to begin with, your stock is going to be shit state before you enter Chapter 11 anyway, you don't get to that point in a day or weeks, it has been a long time coming before you realise you need to file chapter 11, so it won't hit you much with your stock.

Big Company uses Chapter 11 to shield from creditor, in fact, most of all major US business had filed Chapter 11 one way or another and some of them folded (Like Circuit City, Lehman Brothers) but a lot more of them survive (like GM, CIT banking group, Chrysler or Delta Airline)

In the US, Chapter 11 has been widely used to adjust a company direction and to try and write off some debt, in some extreme case, it also used to basically hold the federal government hostage....

Unlike in country such as Australia or UK, you go bankrupt and that's it. Dick Smith was folded in 5 months, Payless Shoes folded in 4 months, but in the US, Chapter 11 is like a second tries (I am not even gonna say chances as you can file multiple Chapter 11)

Huh, good to know. I didn't realize the difference before this.

Well, not too many people know about this, judging from the reaction in this pages.

Chapter 11 used to be called BANKRUPTCY PROTECTION, which literally mean to protect you from declaring Bankruptcy, but since then they changed (or people started to use) the actual title in the code, which is Chapter 11, Title 11, United States Bankruptcy Act. Which is now confusing a lot of people....

In all other law, Chapter 11 is best compare to being in Receivership in common law, but instead of a court appointed receiver, you still in control of your business. The government set a deadline for your Chapter 11 application, the same as in common law when the court set the amount of time your company will be held in receivership.

One more thing, company in Chapter 11 can still borrow money from bank to consolidate your debt subject to court approval, you cannot do that in almost all other country.

My sister in law (and my actual sister) is a CPA, they know about these stuff.
 
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I don't know much about NSG but perhaps you are right that the Bush waiver is driven by business motives, for Toshiba-Westinghouse in particular (may serves Hitachi-GE as well). Korea already building in UAE, Russia progressing in Egypt, KSA. China has different market mapping, other than ongoing GII business in Pakistan, Romania, GIII markets in talks are UK (now in assessment phase for Bradwell), South Africa, Argentina, Kenya as well as new sites planned in CPEC of Pakistan.
Westinghouse already had signed agreement in anticipation of NSG waiver,now thats in limbo.
http://www.ndtv.com/india-news/west...tcy-doubts-over-india-us-nuclear-deal-1674854
"Westinghouse CEO Jose Gutierrez flew to India earlier this month for talks with (NPCIL) and the Department of Atomic Energy that reports to PM Modi, said Reuters. Indian engineering group Larsen & Toubro, a potential partner that has signed a memorandum of understanding with Westinghouse to supply nuclear plant elements and do civil works, still views the India project as viable."
 
Westinghouse is one of American biggest icon in the late 19th to early 20th century. They are the one of five giants that shaped American industrial power along with Rockefeller Standard Oil company, Carnegie Steel, Ford Motor, and JPMorgan. HUGEEE
 
Westinghouse already had signed agreement in anticipation of NSG waiver,now thats in limbo.
http://www.ndtv.com/india-news/west...tcy-doubts-over-india-us-nuclear-deal-1674854
"Westinghouse CEO Jose Gutierrez flew to India earlier this month for talks with (NPCIL) and the Department of Atomic Energy that reports to PM Modi, said Reuters. Indian engineering group Larsen & Toubro, a potential partner that has signed a memorandum of understanding with Westinghouse to supply nuclear plant elements and do civil works, still views the India project as viable."
Similar to Areva's EPR case in Finland, Westinghouse's trouble arises from delays & costs overrun of AP1000 in South Carolina and Georgia, resulting in sustained deficits hence debt crisis. Financing/restructuring is a must, only question is how. Perhaps new debt, or add equity investors like Areva does (Mitsubishi HI, JNFL), or being sold (Toshiba is talking to a few potential buyers e.g. KEPCO), I believe there's a way out.

About India, it's too risky for Westinghouse to commence right away, cos utmost priority now is delivery of work-in-progress projects. If all parties decide to stick to agreed schedule, now knowing the root cause of problem is costs overrun, Areva's adjusted UK (Hinkley C) approach could be a reference case, i.e. bringing in co-investor to take charge of project implementation. KEPCO with its credential in UAE can be an option, or CGN like Areva does for UK Hinkley C. When the first- and second-generation nuclear power plants were built, they mostly came from integrated suppliers who required little from external suppliers. Today most of a new plant comes from a range of pure-play suppliers, and vendor companies are focused on design, engineering and project management. Reactor is only part of the whole complex which requires very advanced, massive and sophisticated supply chain of other industrial capabilities, say large forgings for reactor pressure vessels, steam generators and turbine shafts.

Suppliers of nuclear equipment must be qualified and quality controlled. The American Society of Mechanical Engineers (ASME) nuclear accreditation known as N-stamp is internationally recognized. N-stamp means that the authorized vendor has produced the commercial nuclear-grade components in accordance with the ASME Boiler and Pressure Vessel Nuclear Codes and Standards. It applies to both design and fabrication of components. RCC-M is another international standard developed in France from ASME N-stamp and used outside the USA for nuclear mechanical and pressure components. For China, NNSA registration is linked to US NRC standards, though both ASME and RCC codes are used, principally the latter. ISO-9001 is increasingly important. China had six ASME N-stamp accredited manufacturers at the end of 2009, by October 2011 it had 26. These include:
Harbin Power Plant Equipment Corporation (QHD) Heavy Equipment Co., Ltd.
Shenyang Turbo Machinery Co, Ltd.
Dalian DV Valve Co., Ltd.
China First Heavy Industries
Bohai Shipbuilding Heavy Industry Co., Ltd.
Harbin Boiler Co., Ltd.
Harbin Electric Motor Factory, AC/DC Electromotor Limited Liability Company
Shanghai Heavy Machinery Plant Co., Ltd.
Shanghai No.1 Machine Tool Works Ltd.
Shanghai Electric Nuclear Power Equipment Co., Ltd.
Shanghai Valve Factory Co., Ltd.
CNNC SUFA Technology Industry Co., Ltd.
Neway Valve (Suzhou) Co., Ltd
Shandong Nuclear Power Equipment Manufacture Co., Ltd.
Zhejiang Jiuli Special Material Technology Stock Limited Corporation
Dongfang (Guangzhou) Heavy Machinery Co., Ltd.
Dongfang Electric Group Dongfang Boiler Group Co., Ltd.
China Erzhong Group (Deyang) Heavy Industries Co., Ltd.​
For example, minimum requirement for making the largest AP1000 components is a 15000 tonne press taking 350 tonne ingots. The very heavy forging capacity in operation today that can satisfy this are only Japan (Japan Steel Works 14000 t x 2), South Korea (Doosan 17000 t), China (China First Heavy Industries 15000 t, China Erzhong 16000 t, SEC 16500 t).
 
I was not aware what they actually did , and they did not bother to setup anything in Pakistan when they could have taken advantage of favorable condition for power generation

I was going to post this :)

They are the pioneers of Pressurised Water Reactor type of Nuclear Power Plants, so many designs and co-relations (these co-relations are the hardest things to develop, and they are the most important thing in running a nuclear power plant) are named after them

Thing is, that after 1974 Indian Nuclear test the door was shut on non-NPT countries. Both India and Pakistan still went ahead and through diplomacy or whatever were able to setup more nuclear power plants but USA was not one of the countries that allowed its companies to do business with countries outside NPT. This was a bad move since all the nuclear power plants are under the supervision of IAEA and you can not move a grain of Uranium without them knowing. Whatever embargoes USA enforced on us didnt work either as we were able to produce bomb.

and with the Three Miles Island accident, the approval of Nuclear power plants in USA fell, so much that they completely abandoned it despite being world leaders in nuclear tech. This was a bad move.
 
This all has to do with Westinghouse buying a large construction company in 2015 that owned the engineering/construction firm Stone & Webster. Stone & Webster had already had serious financial problems, scandals, and bankruptcy. People warned Westinghouse not to buy the company but they did it anyway...and it isn't a shock as to what happened.

Here's stuff from 2006 about Stone & Webster

http://archive.boston.com/business/...he_bribe_memo_and_collapse_of_stone__webster/
 
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No you didn't....and yes they are on the list of bailouts. I suggest you just keep quiet and not paint yourself into a corner more. Just let it go.

With the difference that once the Chinese gov. bailed out a private company, it becomes a state asset.

Stupid pindostanis get robbed and yet cheers the robbers.
 

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