NEC Electronics and Renesas agree merger
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A definitive agreement to integrate business operations at NEC Electronics and Renesas has been signed, with the new company tentatively called Renesas Electronics Corporation.
The business integration was announced by NEC Electronics Corporation, Renesas Technology Corporation, NEC Corporation, Hitachi and Mitsubishi Electric Corporation and will become effective following the adoption of the resolutions at the Extraordinary General Meeting of Shareholders and approval by authorities concerned.
The integration will see Renesas issue shares of Renesas common stock to Hitachi and Mitsubishi Electric, the sole shareholders of Renesas, in exchange for a total of approximately 78billion yen. In addition, on the effective date of the business integration – scheduled to be April 1 2010 – the integrated company will then issue shares of its common stock to NEC, Hitachi and Mitsubishi Electric in exchange for a total of approximately 122bn yen. The structure of the merger will be effective with NEC Electronics being the surviving entity.
The goals of the integration are for NEC Electronics and Renesas to provide a variety of semiconductor solutions, primarily mcus, SoCs and discrete products. In doing so, the two companies intend to establish a 'powerful new semiconductor company'.
The ownership ratio will be as follows: NEC Corporation – 33.42%; Hitachi Ltd – 30.73$; Mitsubishi Electric Corporation – 25.14%; Japan Trustee Services Bank – 1.54%. As a result of the integration NEC will no longer be the parent company of NEC Electronics as it is no longer the majority stockholder. Hitachi and Mitsubishi Electric will become the major stockholders.
