Shares in Toshiba skidded today after the conglomerate said it would book a $6.3 billion hit to its US nuclear unit.
It also said it may sell a majority stake in its prized flash-memory chip unit as it scrambles for cash to stay in business.
Facing a March 27 deadline to avoid a delisting, chief executive Satoshi Tsunakawa said he would consider selling most, even all, of the chips business.
This is a turnaround from the conglomerate's previous stance that it would sell only about 20%.
The change of direction has prompted investors to question whether the company would have a long-term future without control of the unit and could well shake up the bevy of suitors interested in a piece of the world's biggest NAND chip producer after Samsung Electronics.
Taiwan's Foxconn is among the companies and funds that were bidding for the smaller stake, a source with direct knowledge of the offer said, declining to be identified.
Other bidders include SK Hynix, Micron Technology and private equity firm Bain Capital, sources have said previously.
Foxconn, which last year bought a controlling stake in Japanese panel maker Sharp Corp, may find it easier than other corporate bidders to buy a large stake as it is not a major memory chip maker and could avoid any lengthy competition review.
Toshiba's new openness towards selling more of its chips business comes as the beleaguered conglomerate failed to deliver audited third-quarter earnings as scheduled yesterday, instead saying it needed more time to look at potential problems at its Westinghouse division.
The expected $6 billion writedown will also wipe out shareholders' equity.
It has been granted an extension until March 14 to submit audited figures but would face a delisting if it still failed to file within eight business days after that.
Toshiba shares slid to end down 9%, giving it a market value of 889 billion yen ($7.8 billion), less than half its value in mid-December. Just under a decade ago, the firm was worth almost 5 trillion yen.
At a meeting with its creditors today, Toshiba executives asked for an extension of a waiver for a loan covenant violation until the end of March, financial sources said, declining to be identified as they were not authorised to speak to the media on the matter.
Cuts to credit ratings after Toshiba warned in December of a large writedown put it in violation of one loan covenant, which could prompt lenders to call in loans early.
Toshiba's loans from banks and insurers stood at about 800 billion yen ($7 billion) as of end-September, a financial source has said. Sumitomo Mitsui Banking and Mizuho Bank are its biggest creditors.
While the two lenders and the state-backed Development Bank of Japan have so far expressed support for Toshiba, other creditors will need more convincing before they back Toshiba further, sources familiar with the matter have said.
Potential investors in Toshiba may also need to heed Japanese government concern about the future of a company its sees as strategically important.