TOKYO (Reuters) - Toshiba Corp 6502.T announced on Thursday it is shedding assets, cutting jobs and buying back its stock starting this week, sending its shares up 13 percent, as the once-mighty Japanese conglomerate aims to regain investor confidence.

The company announced it is liquidating its British nuclear power unit and selling its U.S. liquefied natural gas (LNG) business to China’s ENN Group as part of a new five-year business strategy, which also includes 7,000 job cuts, or 5 percent of its workforce, over five years.

Toshiba’s shares surged 12.7 percent to close near two-year highs after the announcement, helped also by a much anticipated move to repurchase up to 40 percent of its own shares starting Friday.

The 143-year-old company has been trying to win back the market’s trust after a 2015 accounting scandal uncovered widespread irregularities at the laptops-to-nuclear conglomerate for years.

The scandal forced it to recognize huge cost overruns at now-bankrupt U.S. nuclear unit Westinghouse, prompting it to sell its prized memory chip unit earlier this year to a consortium led by U.S. private equity firm Bain Capital and leaving it with few growth businesses.

“There had been reports about a possibility of selling non-performing business and job cuts so such moves had been expected at some point. But investors are taking heart,” said Hiroyuki Fukunaga, chief executive of Investrust, a financial advice firm.

“The share buyback announcement worth up to 40 percent of outstanding shares is definitely positive, too.”

FILE PHOTO: The logo of Toshiba Corp is seen behind cherry blossoms at the company's headquarters in Tokyo, Japan April 11, 2017. REUTERS/Toru Hanai

Toshiba had already promised a share buyback of 700 billion yen earlier this year, but the timing had been undecided. Its announcement on Thursday appeared to outweigh a weaker profit forecast - the company said it now expects a full-year operating profit of 60 billion yen rather than a previous estimate of 70 billion yen.

STEMMING LOSSES

Toshiba had been trying to shed the troubled assets that could have exposed the Japanese company to future losses.

The decision to liquidate NuGen, however, would be a blow to Britain’s plans to build a nuclear plant that was meant to provide 7 percent of the country’s electricity.

NuGen said 18 months of negotiations with a range of potential owners had failed to yield any deal, and that it was now up to the British government and the Nuclear Decommissioning Authority to determine the future of the Moorside site in Cumbria.

South Korea's state-run Korea Electric Power Corp (KEPCO) 015760.KS had been in talks with Toshiba to buy a stake in NuGen. South Korea's energy ministry said on Thursday it will coordinate with the British government and monitor the liquidation process with KEPCO.

Toshiba said it will sell the LNG business to ENN Ecological Holdings 600803.SS, a unit of Chinese gas company ENN Group.

It has spent years trying to either sell the gas to power customers or offload the business after signing a 20-year contract to buy LNG from Freeport in a venture announced in 2013. Asian LNG prices LNG-AS have plunged 42 percent in the past five years, raising fears of future losses.

Toshiba will be paying the buyer $821 million to assume its commitment to purchase 2.2 million tonnes per year of the fuel from Freeport LNG in Texas - a cost booked as a charge for the current financial year.

The company said its exit from the troubled businesses, along with the job cuts and other restructuring moves, will help it bolster its profitability in the longer run. It forecast an operating profit of 240 billion yen in fiscal 2021 compared to 60 billion yen in the current year.