Sat, Dec 25, 2010 - Page 10 News List

Toshiba to sell chip plant, outsource to Samsung Electronics

Bloomberg

Toshiba Corp, Japan’s biggest chipmaker, plans to sell a semiconductor factory to Sony Corp and outsource some output to Samsung Electronics Co as it looks to reorganize its system chip business to improve profitability.

Sony will buy Toshiba’s plant in Nagasaki, Japan, which makes the cell graphics chips used in PlayStation 3 video game consoles using 300mm production facilities, the two companies said in a joint release yesterday, without disclosing financial details.

The Tokyo-based companies said the deal will be completed early in the fiscal year starting in April.

Toshiba is in talks with South Korea’s Samsung, the world’s biggest maker of memory chips, and other companies to outsource production of its system chips, company spokesman Hiroki Yamazaki said.

The manufacturer will combine in-house production of system LSI chips, whose functions range from processing images for television screens to crunching data, with outsourcing, Toshiba said.

The Japanese chipmaker said it will consolidate production of analogue and imaging chips at its plant in Oita, on the southwestern island of Kyushu, and in Iwata, northern Japan.

Sony will buy back the Nagasaki facility for about ¥50 billion (US$602 million) to double its monthly production capacity of the sensors, which are used in digital cameras and smartphones, to about 40,000 units, the Nikkei daily reported on Thursday.

Sony sold the plant in Nagasaki Prefecture, Japan, to Toshiba in 2008.

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