Renesas and NEC Electronics to merge

Tokyo (Japan) –  Chip companies NEC Electronics and Renesas said they have plans to merge, in a move which would turn their combined forces into the third largest semiconductor company in the world.

Renesas is a joint venture owned by Mitsubishi and Hitachi, and aim to complete the merger by April 1st next year.

The chip industry has been hard hit by the credit crunch, and Japanese companies, in particular, have suffered of late.

A combined company would be third behind Intel and Samsung, and will corner the market in microcontrollers. Intel’s speciality is microprocessors, and whenever you remember Samsung you think of, er, memory.

The memory companies – the paramount firm being Korean giant Samsung – believe that they are entering a period of consolidation. The Taiwanese government is attempting to broker a plan which bales out its DRAM champions.

Nevertheless, although the semiconductor companies are suffering from the credit crunch, just like almost every other sector but supermarkets, there can be no doubt that the next decade will be predicated on a plentiful supply of the right kind of chips.

The Internet is not going to go away. Nor are motorcars, aeroplanes, and appliances.