• Kyodo


Panasonic Corp. and Fujitsu Ltd. are considering setting up a new company possibly in the business year from April to merge their system LSI chip operations, sources said Friday.

The move is aimed at rebuilding their respective loss-making businesses by integrating design and development functions of LSI chips, which are used in such products as cars and digital appliances. The name and location of the new venture will be decided at a later date, the sources said.

The government-backed Development Bank of Japan plans to invest tens of billions of yen in the new venture through a new fund to be established to sponsor companies with substantial growth potential, according to the sources.

Struggling chip-maker Renesas Electronics Corp. took part in initial negotiations but failed to reach terms with Panasonic and Fujitsu, they said.

Aside from the joint venture talks, Fujitsu is in negotiations with companies including Taiwan Semiconductor Manufacturing Co. to sell its mainstay semiconductor production base in Mie Prefecture. The company plans to compile by the end of March a plan to rebuild its semiconductor business.

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