Struggling chip-maker Renesas Electronics Corp. will withdraw from the market for small liquid crystal displays as part of efforts to turn around its business, an industry source said Saturday.
Renesas plans to sell all shares it holds in Renesas SP Drivers Inc., a Tokyo-based subsidiary in charge of chip development and sales, to an overseas semiconductor manufacturer, the source said.
By exiting the LCD chip market, Renesas aims to focus on production and sales for automobiles, a sector where the company expects stable growth in the medium and long term.
Renesas owns a 55 percent share in the subsidiary, while Sharp Corp. holds a 25 percent stake and Taiwanese chip manufacturer Powerchip Technology Corp. has a 20 percent share.
Renesas SP Drivers, which has a foothold in Tenri, Nara Prefecture, in addition to its headquarters in Tokyo's Kodaira district, has a workforce of around 240.
Although the subsidiary is in the black on growing demand for a product called driver IC amid the widespread use of smartphones around the globe, Renesas decided to pull out of the market amid intensifying competition with South Korean and Taiwanese rivals, the source said.
Renesas exited the chip market for large LCDs, such as for televisions, in 2012.