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Electronics

Japan chip industry heavyweight joins China's Unigroup

Ex-Elpida CEO Yukio Sakamoto to help semiconductor maker grow globally

Elpida specialized in dynamic random access memory before it filed for bankruptcy in 2012.  

BEIJING -- Tsinghua Unigroup, one of China's leading chipmakers, has hired Japanese semiconductor industry veteran Yukio Sakamoto as a senior vice president and also head of the company's Japan unit.

Sakamoto, 72, served as chief executive of once-leading Japanese chipmaker Elpida Memory, which was established by combining the memory chip units of NEC and Hitachi.

Sakamoto led Elpida for over a decade, from 2002 to 2013, successfully listing the company's shares on the first section of the Tokyo Stock Exchange in 2004. But the financial crisis and falling chip prices hurt the company's finances, eventually leading to its bankruptcy in 2012 and its acquisition by U.S. peer Micron Technology the following year.

Besides Sakamoto's experience, the Chinese government-backed Unigroup likely aims to put his connections in Japan and beyond to work as it expands its reach.

"We are thrilled to welcome Yukio Sakamoto to the Unigroup family," said Zhao Weiguo, chairman and CEO of the Chinese chipmaker.

Former Elpida Memory CEO Yukio Sakamoto speaks during an interview with Nikkei in April. (Photo by Hideaki Ryugen)

"Mr. Sakamoto's appointment is not only a testament to our strategy of growing locally while expanding globally, but will also undoubtedly boost our capacity for innovation," Zhao added.

Unigroup is an offshoot of Tsinghua University, Chinese President Xi Jinping's alma mater, and plays a major role in the country's pursuit of greater self-sufficiency in semiconductors.

Its 2013 acquisition of then Nasdaq-listed mobile chip supplier Spreadtrum Communications accelerated its growth. Unigroup also made an unsuccessful bid for Micron and a failed attempt to invest in Western Digital. Both moves ran into American opposition.

Sakamoto's career also includes positions at Texas Instruments' Japan unit and Kobe Steel.

Elpida specialized in dynamic random access memory. As CEO, Sakamoto flew around the globe to secure funding, as its rivalry with South Korea's Samsung Electronics intensified. He succeeded in convincing Intel to invest over $100 million in Elpida.

Encouraged by Intel's endorsement, parents NEC and Hitachi, as well as business client Canon agreed to offer funding for Elpida to build a cutting-edge chip factory in Hiroshima, Japan.

Elpida later acquired the DRAM operations of Mitsubishi Electric.

But the company struggled to keep pace with the massive capacity investments of its South Korean rivals, and falling electronics demand, after the 2008 global financial crisis exacerbated its cash crunch.

Sakamoto called filing for bankruptcy in February 2012 the "worst day in my life." His expertise in semiconductors, however, was in high demand and Sakamoto served as outside director or adviser to nine companies after leaving Elpida.   

In an interview with Nikkei this year, Sakamoto said it was imperative for China to develop its own chip technology, rather than poaching engineers from South Korea or Taiwan with high salaries.

"It's better for China to persevere for five years and develop its own technology and build a foundation. China has a large domestic market and it would be better to nurture the ability to create semiconductor products that fit that market," he said.    

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