Japan Inc to save Renesas for $2.5 bn: report
Saturday, 13 October 2012
TOKYO: Japan's state-backed turnaround fund and leading domestic manufacturers will invest 200 billion yen ($2.55 billion) in troubled chipmaker Renesas Electronics, a business daily reported Saturday.
The government-backed Innovation Network Corp. of Japan (INCJ) will invest 150 billion yen to acquire two-thirds of Renesas shares, in a plan likely to be agreed next month, the Nikkei daily said.
About 10 leading Japanese companies -- including Toyota, Nissan, Honda, Panasonic, Canon and Nikon -- are expected to pitch in nearly 50 billion yen combined, the report said without citing sources.
German auto parts manufacturer Robert Bosch GmbH has also expressed an interest in an investment, it said.
The INCJ and other players would supply Renesas with funding before the end of the year, paving the way for the firm to start afresh as a specialist in microcontrollers, the Nikkei said.
The participating firms want to ensure stable supplies of high-quality microcontrollers used in cars and electronics products by rescuing Renesas, it said.
Japan's microchip sector has struggled with a strong yen and fierce competition, especially from South Korean and Taiwanese rivals.
Japanese manufacturers, including Renesas, were also hit severely by last year's quake-tsunami disaster.
In late August US investment fund Kohlberg Kravis Roberts proposed investing about 100 billion yen in Renesas, it said.
Major lenders were wary that microcontroller supplies could be disrupted if KKR pushes for significant additional restructuring. (AFP)