SAN FRANCISCO--Japanese electronics firms Fujitsu Ltd. and Panasonic Corp. are close to finalizing a merger of their struggling semiconductor businesses, according to a report Friday by NHK, Japanís national public broadcasting organization.
The report, which cites unidentified sources, said the two companies are finalizing plans to launch the joint company by March 2014. Part of the funding is expected to come from a bank affiliated with the government, the report states. The bank is potentially the Innovation Network Corp. of Japan (INCJ), a public-private partnership that was involved in the bailout of Renesas Electronics Corp. late last year.
The two firms are also in talks with the Development Bank of Japan over a potential investment worth hundreds of millions of dollars, according to the report.
But Fujitsu denied that a merger deal was imminent. "Today there were certain media reports concerning the Fujitsu Group's semiconductor business. These reports are not based on any official announcement made by Fujitsu or interview between a Fujitsu executive and the media. No decision has been made regarding this matter," Fujitsu said in a statement published on the company's website.
Fujitus and Panasonic, along with Renesas, began negotiating a potential merger of their system LSI chip businesses more than a year ago. Renesas, which received nearly $1.9 billion in funding in exchange for 75 percent of the company, is presumably no longer involved in the discussions.
According to the NHK report, the venture between Fujitsu and Panasonic plans to use leading foundry Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) to produce its chips.