Panasonic to sell loss-making chip unit to Taiwan’s Nuvoton for $250m

A Panasonic camera strap is laid out on a table. Photo: Wojciech Magdziak vel Wierzbicki

Panasonic Corp said it would sell its loss-making semiconductor unit to Taiwan’s Nuvoton Technology Corp for $250 million as the Japanese electronics giant struggles to lift its profit amid a lack of growth drivers.

The sale is part of Panasonic‘s plans to cut fixed costs by 100 billion yen ($920 million) by the year ending in March 2022 by consolidating production sites and overhauling loss-making businesses.

Panasonic has already divested most of its chip business as it lost to more nimble Korean and Taiwanese rivals, and has shut down or shifted its manufacturing facilities to its joint venture (JV) with Israel’s Tower Semiconductor.

Its semiconductor unit currently focuses on designing power-management chips and sensors for smartphones, cars and security cameras. It sold part of the power management chip business to Japan’s Rohm Co this month.

The latest deal includes the sale of the entire JV, which is owned 51% by Tower and 49% by the Panasonic chip unit. The JV operates three Japanese chipmaking facilities.

Panasonic said the sale will not have any significant impact on its earnings. The value of the deal that Panasonic has announced excludes the amount Nuvoton would pay for Tower Semiconductor’s stake in the joint venture.

Nuvoton, which was spun off from Winbond Electronics Corp in 2008, supplies chips for electronic devices including computers and audio products.

Panasonic has turned its focus away from low-margin consumer electronics and bet on businesses that sell to automakers, as well as to corporations such as factory-owners and firms that automate processes.

But the shift has failed to lift profit at a time when the U.S.-China trade war has hit industrial purchases and output, and the global car market is contracting.

Reuters

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.