Photo/Illutration The Toshiba Corp. logo adorns a building in Kawasaki. (Asahi Shimbun file photo)

A drastic proposal on the table for troubled Toshiba Corp. calls for splitting the company into three separate entities to oversee key business operations so as to ensure the survival of the once mighty multinational conglomerate.

But many company insiders fear that doing so could trigger the eventual demise of a once-venerated company name if any of those entities later have to be sold.

The new proposal will be incorporated into the medium-term management plan Toshiba is expected to release on Nov. 12, sources said.

Toshiba has come under strong criticism from foreign investors, especially after revelations in June that the company approached the economy ministry to restrain the influence of foreign investors. In the ensuing uproar, Osamu Nagayama failed to win reappointment as company chairman at the June shareholders’ meeting.

Under the proposal, Toshiba would reorganize into three components: one in charge of infrastructure, such as power generation facilities; another in charge of devices, such as hard disk drives; and the third overseeing semiconductor chips. That last component would likely be a holding company for Kioxia Holdings Corp., which was spun off from Toshiba to handle its semiconductor sector.

If the new proposal is included in the medium-term management plan, it will be placed on the agenda for the next shareholders’ meeting. If it is then approved, the process would start to split Toshiba into three separate companies over the next few years.

The eventual goal would be for the three companies to each list on a stock exchange. Current Toshiba shareholders would receive a proportional stake in each of the three new companies.

The plan is being put together mainly by a strategy committee made up of outside directors.

A directors meeting in September issued a statement saying it had asked the committee for a bold medium-term plan that would reflect a clear vision for Toshiba’s future.

A major fear is that breaking up the company into smaller entities would make it easier for mergers and acquisition by other companies that could spell the death knell of the company founded in 1875, depending on the demands of shareholders.