NEC in merger talks with Renesas?

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NEC is reportedly in merger talks with fellow Japanese company Renesas Technology.

If the merger was to go ahead it would make the joint venture firm the third biggest chip manufacturer in the world and see it dominate the world market for microcontrollers with a 30 per cent market share.

The Nikkei newspaper in Japan reported that the two firms wanted to confirm a deal by the end of this month but a report in the Financial Times (FT) said that “sources close to the matter” had confirmed talks taking place but with no decision made as of yet. The source also said that “it could still choose a different partner or a deal other than a full merger”.

Renesas was created in 2003 as a joint venture by Hitachi and Mitsubishi Electric and quickly became one of the four top semiconductor companies in Japan. Together with NEC, its sales would total $12.5 billion, only coming second to Intel and Samsung within the same industry, the FT said.

Both companies are expecting to have made net losses this year which could indicate the reasons for the merger.

A spokesperson from Renesas declined to confirm or deny the rumours but said: “The articles regarding this are not based on official Renasas information.”

NEC had not responded to our request for comment at the time of publication.

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