Japanese chip makers NEC Electronics and Renesas Technology (Renesas), have agreed to merge in April, as their parent companies plan to inject about JPY200 billion. The merger is expected to create the world’s third-largest chip maker in the world.
Renesas will issue shares of its common stock to Hitachi and Mitsubishi Electric, the sole shareholders of Renesas, in exchange for a total of JPY78 billion before the effective date of the business integration.
In addition, on the effective date of the business integration, the integrated company will issue shares of its common stock to NEC, Hitachi, and Mitsubishi Electric in exchange for a total of around JPY122 billion.
The integrated company, which is expected to be called Renesas Electronics, will provide products in its three major product groups, microcontroller units (MCUs), SoCs, and discrete products by concentrating its development resources to further strengthen the companies’ respective advantages. The companies will each continue to execute structural reform plans in order to strengthen their business frameworks.
NEC Corp will own 33.42% of the integrated company, while Hitachi will own a 30.73% stake and Mitsubishi Electric will hold 25%. NEC Electronics president Junushi Yamaguchi will become the chairman, and Renesas president Yasushi Akao will become the president of the new entity, the companies said.
