According to Bloomberg News, Kioxia Holdings‘ lenders aim to refinance 2 trillion yen ($13.5 billion) in loans to support its proposed merger with Western Digital’s (WDC.O) flash memory unit.
According to Bloomberg, Sumitomo Mitsui Financial Group (8316.T), Mizuho Financial Group (8411.T), and Mitsubishi UFJ Financial Group (8306.T) plan to submit a commitment letter for the refinancing next month, citing unnamed sources.
According to Bloomberg, a portion of the loan would be used to pay special dividends to Kioxia shareholders.
According to Bloomberg, Western Digital will control approximately 50.5% of the merged company, with Kioxia holding the remaining 49.5%. Western Digital’s hard drive business is not believed to be included in the agreement.
Kioxia stated that the company had not announced the material in the story and declined to comment. SMFG, Mizuho, and MUFG did not respond to requests for comment.
Four hundred billion yen of the 2 trillion yen loan will most likely be funded by loan commitments, with the Development Bank of Japan providing a loan of 300 billion yen. According to Bloomberg, the remainder will most likely be divided equally among the three megabanks.
Kioxia and Western Digital are speeding up merger talks and finalizing a deal structure, according to Reuters in May, despite a fall in the flash memory industry.
