Fujitsu And Panasonic To Combine Chip Design Efforts

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The new venture will be fabless, hire employees from both companies

This autumn, Fujitsu and Panasonic will combine their chip design expertise in a new company, worth around 50 billion yen (£292 million).

The as-yet-unnamed venture will be fabless, despite the fact that both electronics manufacturers have their own chip foundries, reports Nikkei Asian Review.

The new company is expected to create silicon for connected devices that enable the Internet of Things.

Samsung chip fabUnited we stand

Fujitsu has plenty of experience in making wireless connectivity and image processing chips, while the true strength of Panasonic lies in silicon for home electronics. The two already talked about merging their chip operations in February 2013, but the exact details of the partnership were unknown.

According to Nikkei, Fujitsu will own a 40 percent stake in the new venture, while Panasonic will get 20 percent. The rest will belong to the Development Bank of Japan, which may receive preferred stock.

3,000 employees will be transferred from both companies to work on new chips, the majority of them coming from Fujitsu. All of the intellectual property developed by these people will belong to the new company.

The venture will contract other manufacturers to build silicon based on its designs. Meanwhile, Panasonic is expected to sell its foundries to interested parties in Israel and Singapore.

Fujitsu is in the middle of restructuring its semiconductor business, having sold some of the plants to the US embedded systems manufacturer Spansion. Last year, it was planning to establish a chip production company with Taiwan Semiconductor Manufacturing, but the deal never came to pass.

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