Toshiba America Business Solutions Inc. has moved its North American headquarters from Irvine to Lake Forest, where executives are mapping an acquisition strategy last implemented nearly a decade ago.
The printer and digital signage unit’s move from 9740 Irvine Blvd., the home of several Toshiba businesses, was prompted by lingering financial concerns at majority owner Toshiba Corp.
The unit’s 300 employees now occupy two floors and 70,000 square feet at 25530 Commercentre Drive at the former home of Oakley Inc., ushering in a new era for one of Orange County’s largest companies with deep ties to the troubled Japanese conglomerate.
Toshiba America Business Solutions generates about $1 billion in annual sales and employs over 2,800 in more than 100 U.S. offices and a toner plant in South Dakota. It’s a unit of Tokyo-based Toshiba Tec, which is publicly traded on Japan’s Nikkei exchange and posts $5 billion in annual sales. Toshiba Corp., still reeling from last quarter’s $6.3 billion charge-off related to its bankrupt U.S. nuclear business, is its primary stockholder, with just over a 50% stake.
M&A
Toshiba America Business Solutions insider Larry White was handpicked by Chief Executive Scott Maccabe to lead the acquisitions strategy. It’s a familiar role for the Dallas native, who joined the company in 1996 to kickstart a roll-up plan.
“We’re going back in the acquisitions business,” said White, who was recently promoted from senior vice president of sales for the Americas to chief revenue officer in a newly created position following the retirement of Senior Vice President Bob Greenhalgh.
The local unit anticipates closing its first purchase since early in the Great Recession in the next few months in an effort to expand national distribution in “underserved” markets.
“We’re in the process now,” said White, who oversees about 2,130 employees nationwide in his new role leading direct and indirect sales channels in the U.S., Mexico and Central and South America. “It’s a real good time to be a seller, because you have a lot of companies trying to buy.”
The unit’s last purchase of a product reseller came in 2008 when predecessor Toshiba Office Solutions acquired HPS Office Systems in Indianapolis on undisclosed financial terms.
Greenhalgh joined the unit in 2001 after his company, Connected Office Products Inc. in Pennsylvania, was acquired.
Toshiba America Business Solutions has long served small and midsize businesses with its suite of scanners, printers, copiers and digital displays. It has about 165,000 U.S. customers.
The relocation of its OC operation had been in the works for about a year. The Business Journal reported in December that Toshiba Corp. closed the $65 million sale of its main campus at the Irvine Spectrum to Irvine-based real estate investor LBA Realty. The divestiture of the 26-acre site at the southern edge of the former El Toro Marine base, which included nearly 450,000 square feet of office space, sparked a real estate domino effect for several Toshiba-related business here.
New York-based Toshiba America Inc. finalized a lease in March for 96,000 square feet at 5231 and 5241 California Ave., part of a chain of buildings on the Irvine campus of Broadcom Ltd. at University Research Park. The chipmaker, acquired last year for $37 billion by Avago Technologies Inc., is moving its operation to Great Park Neighborhoods near Irvine’s train station. It’s cut more than 750 jobs, or a third of its local operation, and divested a few promising business lines since the sale.
Toshiba America Inc. markets, sells, distributes and services diagnostic imaging systems, including computed tomography, magnetic resonance imaging, nuclear medicine, ultrasound and X-ray machines.
Other Units
Toshiba Corp.’s global tumult has shaken the local tech market far beyond real estate holdings.
Fountain Valley-based Kingston Technology Inc. was among six technology and financial giants that last month acquired a majority stake in the Japanese company’s lucrative flash memory business for $18 billion.
The sale—one of the biggest storylines in the sector—faces regulatory hurdles and legal challenges by Western Digital Corp., a joint partner in Toshiba’s flash memory business for more than a decade.
Western Digital, the world’s largest drive maker, with about $19 billion in annual sales, moved its headquarters this year from Park Place in Irvine to San Jose.
Kingston is the world’s largest memory products maker for computers and consumer electronics, with estimated sales last year of $6.6 billion.
The Business Journal reported in May that Toshiba planned to close its U.S. commercial phone service division in the second local business closure the conglomerate made in a year.
Toshiba America Information Systems Inc.’s Telecommunication Systems Division, which was also based at the Spectrum campus, employed about 150, making it No. 8 among the largest telecom employers with operations in OC, according to Business Journal research.
The cuts at the time amounted to about 8.5% of the conglomerate’s combined operations here. It entered the year as the third-biggest foreign-owned company in OC based on local employment.
The telecom division, established about 30 years ago, provided IP, digital and cloud-based phone systems and services, and related support and maintenance.
The Business Journal reported last year that Toshiba’s U.S. electronics unit, also headquartered in Irvine, exited the consumer PC market.
The move followed big job cuts at Toshiba America Information Systems, which cut 200 workers a few months earlier, or roughly 20% of its workforce. The unit primarily handles marketing and sales operations in the U.S. for its Tokyo parent.
It’s Toshiba’s largest local unit, with annual sales of about $3 billion, and sells business laptops; LCD and LED televisions; Blu-ray and DVD players; camcorders; imaging products for the security, medical and manufacturing markets; and storage products for the automotive, computer and consumer electronics sectors.
Toshiba established the Irvine campus in 1987 as the U.S. headquarters of its information equipment business. It made PCs there for about 15 years until 2002, when it converted most of the property into office space and a warehouse.
Toshiba America Business Solutions moved operations there in 2012 from a nearby office.
