Fujitsu Ltd., Panasonic Corp. and a government-affiliated bank said Wednesday they plan to jointly set up a new company by the end of this year to design and develop system LSI chips for cars and smartphones.

The new company, to be formed through the merger of the system LSI chip businesses and related intellectual properties of the two electronics producers, will operate without manufacturing facilities, apparently to reduce risks from plunging production amid economic slumps.

The Development Bank of Japan will invest up to ¥20 billion in the new company, they said. The bank and Fujitsu will own 40 percent of voting rights, and Panasonic 20 percent.

The three parties plan to reach a final agreement by the end of June, with an eye to completing the integration and starting operations in the October-to-December period, they said.

The new company will employ about 3,000 people. Annual sales are projected at ¥150 billion, they said. Former Kyocera Corp. President Yasuo Nishiguchi will be CEO of the new firm.