NEC spins out chip biz

NEC Corp kicked off phase two of its restructuring yesterday, announcing plans to spin off its semiconductor operations into a separate company.

The Japanese electronics giant said it will establish the new silicon-based subsidiary by November 2002, and will launch an IPO of 30% of its stock as soon as possible. The new arm will include LSI, ICs, and discrete devices. The unit will have 25,000 employees and turnover of around JPY700bn ($5.5bn).

Other units of the NEC Electron Devices business will "advance reforms by proactively utilizing the capital market and third party investment, with NEC planning to eventually become the minority shareholder."

This means joint ventures for a variety of businesses. NEC's DRAM business has already been spun into the Elpida partnership with Hitachi. The electronics components business is being spun into a new company with Tokin Corporation; the TFT-LCD business is being put into a joint venture with SVA Group Ltd; the PDP business is being spun out and a partner is being sought; the printed wiring business moves into a joint venture with Toppan Printing Co Ltd; the automotive electronics business will be spun into a joint venture with Honda Motor Group.

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