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Toshiba Medical Systems announces new name, bright future forecast

by Thomas Dworetzky, Contributing Reporter | February 01, 2017
Business Affairs
Toshiba Medical Systems Corp. will have its name changed to "Canon Medical Systems Corp." on or about the beginning of 2018, according to the company.

The mega-deal that saw Canon buy the group from Toshiba appears to be having the desired effect, bolstering its bottom line.

Canon just forecast operating profit to climb 11.4 percent for the full year. That's the first upward movement for revenue in three years, according to a Reuters report, which noted it was “bolstered by earnings from a medical equipment unit it bought from Toshiba Corp last year.”

The forecast, which called for a $2.3 billion rise, was in line with analyst estimates, according to Thompson Reuters.

Rumors had swirled this month that Canon might ride to Toshiba's rescue again and put money into its chip business. But Canon CFO Toshizo Tanaka said at a 2016 earnings news conference in late January that such a deal would be “difficult,” according to the Japan Times.

His reasoning is in line with the $6 billion Toshiba Medical buy. He said that Canon is undergoing a “major strategic transition” away from its mainstay businesses toward new ones, specifically medical equipment.

“To that end, we have a range of investments coming up. Considering the situation, it would be very difficult to invest in Toshiba’s semiconductor operation,” he said, adding that this is “our outlook at this moment.”

The die has not been definitely cast against a chip investment however. Canon's Chairman Fujio Mitarai was cited in an interview recently stating that Canon was “positively considering” taking a stake in it.

The Toshiba medical unit went to Canon in March, 2016, and the deal officially closed in December of that year, as HCB News has reported.

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