updated 03:55 pm EST, Fri January 30, 2009
Toshiba, NEC chip merger?
Toshiba is said to be in negotiations with the semiconductor unit of NEC to merge part of its chip operations as it struggles with dropping demand, according to a Friday report for the International Herald Tribune. The source remains unnamed as the talks weren't made public by either company, and Toshiba wouldn’t comment on the rumors. The majority, some 65 percent, of NEC is owned by Toshiba, and the parent company has gone on record to say Japanese chipmakers need to consolidate operations in order to be profitable worldwide.
Toshiba has said it would consider sharing its system and discrete chip manufacturing capacities to help it cut down on costs. NEC has made a similar statement, saying it needs to prioritize operational changes, but adding it would cut costs to the tune of $890 million over two years and getting rid of 1,200 contract positions.