Nikon slips as Intel's ASML deals spurs profit worry

A logo of Nikon is pictured at a trade show for Japan's manufacturing industry in Tokyo June 20, 2012.

TOKYO (Reuters) - Shares in Nikon Corp (7731.T) slipped on Tuesday as investors worried that Intel Corp's (INTC.O) plan to invest in ASML (ASML.AS) (ASML.O) may hurt profits at the Japanese company, which vies with ASML to sell semiconductor production equipment to the U.S. chipmaker.

Nikon's shares slipped 6.3 percent by midday in Tokyo after Intel said it plans to buy up to 15 percent of ASML, the largest maker of steppers and scanners used to etch circuits onto silicon wafers.

Nikon, ASML's main rival, currently ships about half its scanners output to Intel, analysts estimate.

The impact of Intel favoring equipment built by ASML would not be immediate, but could begin to show up in results as the next generation of etching equipment is introduced over the next couple of years, an analyst told Reuters, on condition he was not identified.

Chipmaking equipment accounts for around one-tenth of sales at the Japanese company, which is better known for its cameras. Rival camera maker Canon (7751.T) also makes steppers, although they account for a much smaller proportion of its business. Canon shares rose 0.8 percent in morning trade.

(Reporting by Tim Kelly; Editing by Michael Watson)