Apple is willing to spend billions to obtain a "substantial stake" in Toshiba's chip business, reports NHK.
After the warning by Western Digital, Apple's recent interest will give way to more complexities, as the company is cash-rich and has big influence as the maker of the iPhone, notes Bloomberg. Representatives for Apple in Japan didn't respond to calls for comment.
The Japanese government is concerned about Toshiba selling critical technologies to foreign buyers, and it is closely monitoring the bidding process. Toshiba has been at odds with PricewaterhouseCoopers Aarata over accounting at Westinghouse, where the billions of dollars in losses stem from cost overruns on nuclear construction projects.
However, this sale could end up being hard to pull off, as Western Digital is a partner in Toshiba's chip making business.
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Toshiba has narrowed the original group of contenders for the chip business after a first round of bidding.
"Its financial problems were a major drag on the growth of its memory business", Sean Yang, research director of DRAMeXchange, said in an earlier interview.
Any acquisition of the memory chip business faces hurdles. The company also stated that it should be given exclusive negotiating rights, notes CNBC.
Auditors suggest - "It is an unusual move for a Japanese company-and with a warning that the entire company could collapse". Those bidders include a team made up of chipmaker Broadcom and private equity firm Silver Lake Partners LP.
Toshiba could even retain a partial stake in the chip venture itself to smooth things out with regulatory authorities. The company lost nearly 30% in stock value year-to-date based on data from Google Finance.