Toshiba begs for billions

Old Japanese Beggar --- Image by © Corbis

Old Japanese Beggar — Image by © Corbis

Troubled Japanese electronics outfit Toshiba has popped around to the bank to ask for a quick loan to sort itself out.

Toshiba has asked for a $2.49 billion credit line by the end of January which it says it will use to fund a large-scale restructuring.

The Nikkei Financial Daily earlier said it would likely seek help from banks including Mizuho Bank and Sumitomo Mitsui Banking. This is not the first time that Tosh executives have put on their best suit and worn a tie to see the bank manager but it needs a wider safety net as it seeks to recover from the book-keeping scandal in which it overstated profits from around 2009.

Moody’s recently downgraded the company’s debt rating to junk status, and the Tokyo Stock Exchange has placed Toshiba stocks in a special “watch” category to see whether it can improve internal controls. Both moves have made it harder for the company to raise funding through debt or new shares.

The company said last week it would slash 6,800 consumer electronics jobs, taking total cuts beyond 10,000, including previously announced plans, as the sprawling conglomerate focuses on chips and nuclear energy. It also expects a record net loss this year.