Canon holds the final bid round for Toshiba Health Systems

Canon has emerged as the final negotiating bidder for the purchase of Toshiba Corporation's medical business as part of the latter's plan to renew its financial strength.

Toshiba Medical Systems witnessed a heated bid war amidst contenders for the companies medical business which was put up on sale last year.

Several prominent investment firms and companies led by Fuji film, Sony, Samsung, Hitachi, and GE Healthcare supposedly submitted their bids in an auction in January.

The second round of negotiations saw the list of biding contenders narrow down to Fujifilm Holdings Corp. and Konica Minolta Inc., who submitted a joint bid with European private equity firm Permira sources revealed.

Fujifilm, the fore runner closely followed by Cannon are both known to be offering Toshiba a close of $ 6 billion dollars for the prestigious health medical business ,manufacturing X-ray machines, computed tomography (CT) scanners, and magnetic resonance imaging (MRI) systems, and is one of the parent company's few remaining revenue generators; 405.6 billion yen being the reported revenue in the last financial year.

Events have taken a fresh turn with Canon emerging as the final bidder for the purchase . According to a press release issued by the company Toshiba has granted exclusive rights to Canon to continue discussions till March 18, 2016, in anticipation of a final agreement.

After close evaluation of the bids offered Toshiba Corporation has concluded that Canon Incorporation's proposal is superior in terms of value and possibilities of successful completion of the transaction.

According to Reuters, little overlap of products between TMSC and Canon is the prime reason besides the 700 billion yen offered by Canon to Toshiba for it to emerge victor. It is understood that Canon is planning to gain foothold in the medical business through acquisitions.

"The price tag for Toshiba's medical unit would be a bit expensive," says Ryosuke Katsura, an analyst at SMBC, Nikko Securities. "It would be roughly 30 times the unit's operating profit in the year ended March 2015. The business synergy between Toshiba's medical unit and Canon's is very limited, given the small presence of Canon in the medical industry." he further adds.

It is believed that Toshiba would be able to pay back the outstanding and loan owed by it to the Japanese banks if the deal is successfully accompalished adds the Wall street Journal.