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NEC Electronics Corp., which has inked an integration contract with fellow chip maker Renesas Technology Corp., is eyeing either Toshiba Corp. or Panasonic Corp. as its partner in developing an advanced semiconductor system, President Junshi Yamaguchi indicated Thursday.

“We are set to hold discussions on how to consolidate the process development after inking the contract for our integration, since it would be odd to have two kinds of development,” Yamaguchi said in an interview.

NEC Electronics and Renesas Technology are set to sign their contract at the end of July, with an eye to integrating operations by April 1.

The deal between Renesas, Japan’s No. 2 semiconductor maker, and third-ranked NEC Electronics is set to create the world’s third-biggest chip maker, behind Intel Corp. of the United States and Samsung Electronics Co. of South Korea.

In terms of developing the state of the art LSI system, NEC Electronics, a chip unit of NEC Corp., has a partnership with Toshiba, while Renesas, a joint venture between Hitachi Ltd. and Mitsubishi Electric Corp., has teamed up with Panasonic.

Yamaguchi said that since the development both NEC Electronics and Renesas are pursuing overlaps in certain areas, he does not see the need to maintain both undertakings.

On the envisioned integration, Yamaguchi declined to disclose further details, including the new entity’s integration ratio.

He also vowed to return the company’s earnings to the black for the current business year through next March and said the firm will continue to draw strength from providing chips to cars amid the growing popularity of hybrid cars and electric vehicles.

Amid stagnant demand and erosion of chip prices, the company posted a group net loss of ¥82.6 billion for the business year that ended in March.

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