UPDATE 1-Sanyo to close 2 domestic chip plants by 2012 - Nikkei

Sept 18 Fri Sep 17, 2010 2:56pm EDT

Sept 18 (Reuters) - Japan's Sanyo Electric 6764.T will close two of its domestic semiconductor plants by 2012 and move production to another plant along with about 1,000 workers, the Nikkei business daily said.

The plants -- one in Oizumi, Gunma Prefecture, and the other in Anpachi, Gifu Prefecture -- handle front-end semiconductor fabrication processes, which involve forming circuits on silicon wafers, the paper said.

The Oizumi plant produces transistors for television sets and mobile phones, while the Anpachi plant makes system chips for digital cameras and other products, the Nikkei said.

Transistors and system chips will continue to be supplied through the transfer of production equipment to a Sanyo plant in Ojiya, Niigata Prefecture, a relatively new plant, which makes analog chips and offers high productivity, it said.

Production efficiency at the aging Oizumi and Anpachi plants has been declining, the daily said.

Most of the roughly 700 workers at the Oizumi plant and about 300 employees at the Anpachi plant are expected to end up at Ojiya, the Nikkei said.

But some will get reassigned to solar cells, lithium ion batteries and other growth areas of Sanyo, the paper said.

In July, Sanyo, majority owned by Panasonic Corp (6752.T) agreed to sell its chip business to U.S. chipmaker ON Semiconductor Corp (ONNN.O) for 33 billion yen ($373 million). [ID:nTOE66E063] (Reporting by NR Sethuraman in Bangalore; Editing by Gopakumar Warrier)

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