Earlier today, hit by slumping orders and competition from rivals like Samsung (News - Alert) Electronics Co Ltd, Renesas Electronics Corp, Japanese chipmaker, secured a 150 billion yen ($1.8 billion) lifeline from a government-led bailout. In exchange for a two-thirds stake in the world's biggest maker of microcontroller chips for cars, Renesas, the taxpayer-funded Innovation Network Corp of Japan (INCJ), will provide 138.4 billion yen.
Approximately 12 billion yen will be provided by eight key manufacturing clients including Toyota Motor Corp, Nissan Motor Co, Canon Inc. and Panasonic Corp. Sources familiar with the talks have told Reuters (News - Alert) that, to counter an earlier bid by U.S. private equity firm KKR & Co LP, the bailout was put together amid worries that the firm's technology could fall into foreign hands.
Earlier this year, seeing that fellow chipmaker, Elpida Memory Inc. was driven into bankruptcy, and thus to avoid the fate, Renesas, said that it would spend 60 billion yen on research and development and capital spending related to its core microcontroller business. The company said it was also requesting another 50 billion yen in support from the government fund... Read More