TOKYO, June 12 Fujitsu is keen to
restart talks on merging its struggling system chip division
with those of Renesas and Panasonic Corp, in a
bid to confront tough global competition and preserve Japan's
semiconductor industry, the Asahi newspaper reported.
Japan's chipmakers have been struggling in the face of a
strong yen and fierce competition from nimbler and more
aggressive competitors such as South Korea's Samsung Electronics
Fujitsu, Renesas and Panasonic had been in discussions to
combine their system LSI chip operations, but the talks stalled
as Renesas grappled with mounting losses and after the February
bankruptcy of DRAM chip maker Elpida Memory, the
Fujitsu President Masami Yamamoto told the Asahi in an
interview that such a merger would only be considered if Renesas
carries out an aggressive turnaround plan.
"We must keep semiconductors, which use cutting edge
technology, in Japan or lose the bedrock of manufacturing,"
Yamamoto told the newspaper. "In order to survive, Japanese
businesses must consolidate."
Renesas - itself a product of successive mergers of the chip
divisions of Mitsubishi Electric Corp, Hitachi Ltd
and NEC Corp - has been trying to raise more
than 100 billion yen ($1.3 billion) in fresh capital and plans
to cut at least 12,000 jobs, sources have told Reuters.
Renesas, the world's fifth-largest chipmaker, has struggled
to revive its system-on-chip business, which makes highly
customised system LSI chips that are used in a range of
electronics products, including televisions made by Japan's
struggling consumer electronics makers.
Japanese media reported last month that Renesas was looking
to sell a chip plant in northern Japan to Taiwan Semiconductor
Manufacturing Co, the world's biggest contract
Renesas' escalating troubles follow the massive bankruptcy
in February of Elpida, Japan's last remaining maker of dynamic
random access memory (DRAM) chips used in personal computers.
Elpida is in talks with U.S. firm Micron Technology about
a buyout plan.
Shares of Renesas shares were down 2.1 percent in morning
trade, while Fujitsu slipped 1.9 percent and Panasonic dropped
3.5 percent, compared with a 1.3 percent decline in the
benchmark Nikkei average.