Menu
Struggling Japan chipmaker Renesas to raise US$1.8 billion

Struggling Japan chipmaker Renesas to raise US$1.8 billion

The firm said it willl issue new shares to a large fund as well as firms such as Toyota, Nissan, Canon and Panasonic

Japanese chip giant Renesas is seeking a US$1.8 billion capital injection to invest in new manufacturing techniques. The world's largest microcontroller manufacturer, its products find their way into game consoles from Microsoft and Nintendo, and into cars including Toyota's Prius hybrid range.

Renesas has been attempting to turn its struggling business around for years. It cut nearly 7,500 jobs through an early retirement program this year, and sold off factories. The company hinted at further job reductions in a news release Monday, saying it was planning "further optimization of the personnel structure." For the fiscal year through March, Renesas projects a loss of 150 billion yen (US$1.8 billion), double its loss for the previous fiscal year.

The importance of Renesas to the global supply chain was clear after the magnitude-9.0 earthquake that struck off the coast of the Japan last year, knocking out a major plant in Ibaraki Prefecture, about 250 kilometers from the epicenter. That plant was far enough inland to avoid damage from the resulting tsunamis, but precision machinery was jolted out of alignment and clean rooms were damaged, leading to months of production delays for the company and its key clients.

The company plans to raise capital by issuing new shares to a large government-backed fund and large clients including Toyota Motor, Nissan Motor, Canon, Nikon and Panasonic. The government fund, called Innovation Network Corporation of Japan, may also provide up to 50 billion yen in additional funding. The share sale is to take place from Feb. 23 to Sept. 30 next year. The biggest buyers will be the government-backed fund, followed by Toyota and Nissan.

Renesas said it will use the cash raised to invest in advanced manufacturing for its products, and to develop new solutions for automotive and industrial clients. The company was formed in 2003 from the semiconductor divisions of Hitachi and Mitsubishi Electric, and merged with NEC Electronics in 2010.


Follow Us

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags business issuesinvestmentsrestructuringRenesasComponents

Featured

Slideshows

Meet the leading customer-centric Microsoft channel partners

Meet the leading customer-centric Microsoft channel partners

Microsoft honoured leading partners across the channel following a year of customer innovation and market growth in New Zealand. The 2018 Microsoft Partner Awards recognised excellence within the context of the end-user, spanning a host of emerging and established providers.

Meet the leading customer-centric Microsoft channel partners
Reseller News launches new-look Awards at 2018 Judges’ Lunch

Reseller News launches new-look Awards at 2018 Judges’ Lunch

Introducing the Reseller News Innovation Awards, launched to the channel at the 2018 Judges’ Lunch in Auckland. With more than 70 judges now part of the voting panel, the new-look awards will reflect the changing dynamics of the channel, recognising excellence across customer value and innovation - spanning start-ups, partners, distributors and vendors.

Reseller News launches new-look Awards at 2018 Judges’ Lunch
Show Comments