A majority of Toshiba Corp. shareholders on Thursday rejected a management proposal to split the Japanese conglomerate into two listed companies.

Toshiba, a household name in Japan with a nearly 150-year history, had sought support for the new reform plan at an extraordinary shareholders' meeting after its earlier plan to divide into three was met with opposition from some major shareholders.

The outcome of the vote is not legally binding but indicates likely rejection when the company plans to hold a regular shareholders' meeting in June 2023 for a final decision.

"We will consider a range of options to improve corporate value," Toshiba President and CEO Taro Shimada said following the results of the vote.

The firm said in November it was planning to split into three listed companies -- two spinoffs that would focus respectively on the infrastructure and device businesses, and a third that would own a stake in flash-memory chip company Kioxia Holdings Corp.

The move was seen as an attempt to appease shareholders frustrated by lackluster efforts to boost growth and corporate value.

But the initial plan was revised in February amid opposition from some activist stakeholders, leading Toshiba to propose a new strategy to transform into two firms instead.

The new plan would have seen it spinning off in the second half of fiscal 2023 its device business, including its semiconductor and hard disk drive segments, but keeping the infrastructure unit within Toshiba.

Toshiba has a variety of businesses, from nuclear power and elevators to hard disk drives and semiconductors. In fiscal 2020, which ended in March 2021, it had over 3 trillion yen ($24.8 billion) in sales.

==Kyodo

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