Costly Trade-Off: Toshiba announced plans in March to sell up to 100% of its highly valuable chip business in order to offset a $6.3B write-down from its majority-owned nuclear reactor unit, Westinghouse Electric Co. — Westinghouse filed for bankruptcy in the U.S in on March 29. From the outset, Toshiba and the Japanese government made clear their preference for a domestic buyer.

Change of Tide: Just up until two weeks ago, Western Digital had been in the front running, amidst expansion of its cloud capabilities with two smaller acquisitions. After the announcement of Toshiba’s MoU with Bain, Western Digital stated, “We are disappointed that Toshiba would take this action despite Western Digital’s tireless efforts to reach a resolution that is in the best interests of all stakeholders.” The combination of Western Digital and Toshiba could create a market share of over 30% in the growing NAND flash memory market, which hit $36.7B last year and will grow 40% until 2021, Samsung Electronics is the leader of the pack; Samsung’s market share stands at 36.7%, whereas Toshiba’s market share fell 4.5 percentage points to 17.2% and Western Digital’s fell 0.5 percentage points to 15.5% in the first quarter of this year.

Not Just About Numbers: Toshiba is considering more than just selling to the highest bidder. Earlier in April, Taiwan-based Foxconn, the world’s largest contract electronics maker and supplier for Apple, submitted the highest bid at ~$27B, but Toshiba is favoring Bain at this point in time. Foxconn stated that it has not yet given up, as it proactively has been looking to move past being merely a manufacturer. Foxconn has been eyeing companies with higher margins, taking control of 100-year-old Japanese electronics company Sharp Corp. last August, when it bought two-thirds of the company for $3B.