TOKYO -- A government-backed turnaround fund is proposing to sell part of its more than two-thirds interest in Japanese chipmaker Renesas Electronics to Toyota Motor, Panasonic or other existing shareholders, The Nikkei has learned.
The Innovation Network Corp. of Japan's move to draw down its investment comes after the once-struggling Renesas posted a profit in the year ended March 31. The INCJ wants to lower its stake to less than 50%.
Hurt by a strong yen and production stoppages following the 2011 tsunami that struck northeastern Japan, Renesas turned to the INCJ and major clients in 2013 for a capital injection of 150 billion yen ($1.53 billion at the time). The fund poured in 138.3 billion yen to become its parent company, owning slightly more than 69%.
The INCJ's stake is worth just over 870 billion yen based on Tokyo Stock Exchange-listed Renesas' closing price Friday. A lockout period during which the fund could not sell its Renesas shares ended Sept. 30.
Other potential buyers besides Toyota and Panasonic include Hitachi and Mitsubishi Electric. The INCJ also appears to be sounding out Canon, Denso and others who became Renesas shareholders during the company's crisis. It may end up selling the shares in small amounts to multiple companies.
The INCJ will consider maintaining its current ownership level if negotiations on the sale take too long. Renesas will continue to undertake research and development in such new fields as driver-assistance technology and networked devices -- the Internet of Things -- in pursuit of longer-term growth.
German chipmaker Infineon Technologies and other foreign manufacturers and investment funds have made specific proposals to the INCJ about investing in Renesas. But the INCJ will seek to unload the shares to domestic companies to keep Renesas' proprietary technology from falling into foreign hands.