Toshiba and NEC May Form Semiconductor Joint Venture

Toshiba and NEC Looking Forward to Merge Chips Businesses

by Anton Shilov
01/31/2009 | 11:25 PM

Toshiba Corp. and NEC Electronics Corp. plan to form a semiconductor joint venture, according to anonymous sources close to the talk. The move would help for the companies to reduce costs and become more competitive on the global market. But the joint venture will not be formed overnight.

 

According to a report from the International Herald Tribune, there are talks to merge system-on-chip operations of NEC and Toshiba into a standalone joint venture, but nothing has been decided yet. The Nikkei business daily said NEC has been talking with Fujitsu. as well about a merger of their chip-making operations, though, nothing concrete is known at this point.

Atsutoshi Nishida, chief executive officer of Toshiba, said that too many chip makers, especially those who make system chips, are fighting it out in Japan and that they need to consolidate to win globally. However, he did not announce any definite moves.

Neither Fujitsu, NEC nor Toshiba commented on the news-story.

It is crucial for Japanese companies to consolidate their forces in semiconductor development and manufacturing, if they want to keep those operations in the country. Globally, there is a trend towards forming large chip development design houses as well as massive contract manufacturing houses.