Toshiba has revealed it will be buying back $6.3bn (£4.71bn) in stock that has seen its share price rise as much as 11 per cent.

The decision was made as part of a pledge made by Toshiba to share the proceeds of an $18bn sale of its memory chip business to US private equity firm Bain Capital, which closed earlier this month.

The news has created a wave of relief for some, who were awaiting the decision as a sign of positive news for the company after it began selling off its chip unit and other assets.

Read more: Toshiba completes £13bn sale of chip arm to Bain-backed consortium

Toshiba is also making history, as its decision to repurchase is reportedly the largest ever buyback planned on the Japanese market. Toshiba reached an intra-day high of ¥351 earlier today, before slightly falling to an overall increase of 6.7 per cent by market close.

Investors had planned to raise the issue of Toshiba keeping too much cash from its recent sales at the companys annual shareholder meeting later this month.

The firm itself has only recently come out of a period of financial turmoil, narrowly avoiding a de-listing following an accounting scandal and massive cost overruns at its US nuclear business Westinghouse.

Toshiba raised ¥600bn in fresh capital last December to bolster its balance sheet. According to data from MarketWatch, foreign investors who took part in the capital raising are currently sitting on a 28 per cent gain after yesterdays announcement.

Toshiba also recently sold a majority stake in its personal computer business to Japanese electronics maker Sharp, in a deal which briefly caused Sharps share price to rise before falling to a 17-month low.

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