November 16, 2012 / 1:46 PM / in 5 years

UPDATE 1-STMicro has no plans to buy out Ericsson from JV-CEO

By Paul Sandle

BARCELONA, Nov 16 (Reuters) - French-Italian group STMicroelectronics has no plans to buy out partner Ericsson from their struggling wireless chipmaker joint-venture ST-Ericsson.

When asked if buying out Ericsson was under consideration, STMicro President and Chief Executive Carlo Bozotti, speaking on the sidelines of a Morgan Stanley conference, told Reuters: “No, no plans.”

Bozotti, speaking to investors at the Morgan Stanley Technology, Media and Telecoms conference on Friday, also repeated a denial of any plan to split STMicro into its digital and analogue divisions, a scenario reported in the press.

“I want to say it again, we do not have any initiative ... this is just not true,” he said. “This has never been presented to our board. We are completely aligned.”

He said there were a lot of synergies between analogue and digital businesses, adding that he wanted to focus on a strategic plan for the business to be unveiled next month.

Ericsson and STMicro said in October they had hired banks to advise them on their joint venture which is under pressure from the decline of Nokia, its biggest customer.

STMicro’s full takeover of ST-Ericsson has been seen by analysts as one of the best options for the venture.

ST-Ericsson had already revamped its strategy in April this year, which included 1,700 job cuts and a plan to work with STMicro to develop application processors.

STMicro makes chips for everything from TVs and PCs to printers, smartphones, hybrid electric vehicles and medical imaging devices.

Bozotti also said STMicro would return to growth from the second quarter next year, as this quarter and next continued the flat trend seen since the middle of 2012.

“What we plan is stability over the fourth quarter ... and then back to some growth over Q2 and a stronger second part of the year,” he said.

Bozotti told the conference the group’s secure card business was making progress, and it had signed a contract with Google , which is one of the key players in the digital payments industry.

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