ArrowArtboardCreated with Sketch.Title ChevronCrossEye IconIcon FacebookIcon LinkedinShapeCreated with Sketch.Icon Mail ContactPath LayerIcon MailMenu BurgerPositive ArrowIcon PrintIcon SearchSite TitleTitle ChevronIcon Twitter
Business

Renesas to withdraw from LCD chip business

OSAKA -- Japanese semiconductor firm Renesas Electronics has decided to sell off an LCD driver chip subsidiary, exiting from the business altogether as part of restructuring efforts, The Nikkei learned Friday.

     The company will unload Renesas SP Drivers, which handles development and sales of driver chips used in small and midsize LCDs. In the current fiscal year through March, the unit is expected to generate sales of some 60 billion yen ($577 million), securing 6 billion yen or so in profit. Operating in Tokyo and Nara Prefecture, the company employs about 240 workers.

     Renesas has a 55% interest in Renesas SP Drivers. Sharp and Taiwan's Powerchip also own 25% and 20% of it, respectively. Renesas is planning to unload its entire stake.

     Bidding will be held as early as March, with the sale expected to wrap up by the end of this year. The company will likely fetch tens of billions of yen. Powerchip and other foreign chipmakers are apparently showing interest.

     The market for LCD driver chips for small and midsize LCDs is expanding thanks to the rise of smartphones. In 2013, the market for mobile-phone-use chips, which help send image data to cell phone screens, grew 25% to some $2.5 billion.

     Renesas SP Drivers is the industry leader in this field, with a global market share of some 30%. But as product prices fall due to competition from South Korean and Chinese newcomers, the parent decided to unload this business. Back in 2012, Renesas pulled out of the business of driver chips for large LCDs as well.

     The firm will now focus on automotive and industrial chips, to secure more long-term, stable contracts.

     Renesas plans to shut five factories in Japan and slash its workforce by 25%, or 5,400. But so far only one of the five plants has a sales deal in place. Many details have yet to be sorted out.

(Nikkei)

Get unique insights on Asia, the most dynamic market in the world.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Get Unlimited access

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends January 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to the Nikkei Asian Review has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media