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Source By: Theglobeandmail
Toshiba warned on Monday it would incur its largest net loss ever as it tries to restructure a stable of unprofitable businesses.
The Japanese company, whose financial struggles were laid bare this year in a $1.2-billion (U.S.) accounting scandal, said it would eliminate 7,800 jobs, mostly in its slumping consumer-electronics division. That brings the number of job cuts announced this year to more than 10,000 total, or roughly 5 per cent of its work force.
The Japanese Securities and Exchange Surveillance Commission, a government financial-market watchdog, is pursuing a 7.3-billion-yen fine against Toshiba, which would be the largest such penalty imposed in the country.
Like many Japanese tech giants, Toshiba has been reluctant to close or sell money-losing divisions such as televisions and home appliances, which employ thousands of people but whose competitiveness has been undercut by producers in lower-cost countries.
In addition, analysts say, Toshiba never managed to digest its acquisition of Westinghouse in 2006, which cost it $5.4-billion (U.S.). Its problems only deepened with the financial crisis and the nuclear meltdowns in Fukushima in 2011, which crippled the atomic power industry in Japan. Toshiba is one of the biggest suppliers of equipment to Japanese electric utilities, both for nuclear and conventional fossil-fuel generation.