TOKYO, Japan, January 29, 2014 — Renesas Electronics Corporation (“Renesas Electronics”, TSE: 6723) and Sony Corporation (“Sony”, TSE: 6758) today announced that they have signed a definitive agreement to transfer a semiconductor manufacturing facility and related equipment (the “Asset Transfer”) at the Tsuruoka Factory (12-inch front-end wafer fabrication line of the semiconductor production facility) of Renesas Yamagata Semiconductor Co., Ltd. (“Renesas Yamagata Semiconductor”), a wholly-owned subsidiary of Renesas Electronics, to Sony Semiconductor Corporation (“SCK”), a wholly-owned subsidiary of Sony.
1. Background of the Asset Transfer
As announced on August 2, 2013, in the news release “Renesas Electronics Shows Direction of Renesas Group,” Renesas Electronics has been promoting the realignment of Renesas Group's manufacturing sites in Japan in an effort to strengthen its financial base. As part of this process, Renesas Electronics is working to maintain and strengthen its high-quality technology in the areas where its strengths lie, such as flash MCUs (microcontrollers) and low-power operation technologies, while concentrating and consolidating its front-end facilities based on production efficiency and cost-to-performance ratio.
As announced on April 12, 2012, in the news release “Sony Transformation to Revitalize Electronics Business, Generate Growth and Drive New Value Creation,” Sony is positioning the imaging business as one of its core electronics businesses. As part of this strategy, Sony has been exploring opportunities to increase its production capacity for image sensors, a key component used in mobile products such as smartphones and tablets, for which increasing demand is anticipated.
Based on the background above, Renesas Electronics and Sony signed the Asset Transfer Agreement today, under which a semiconductor manufacturing facility and related equipment are expected to be transferred to SCK on March 31, 2014. This Asset Transfer is subject to the receipt of necessary regulatory approvals.
After the Asset Transfer, the system LSIs and others produced at the Tsuruoka Factory will be produced there for Renesas Electronics by SCK on a contract basis for a certain period of time as agreed by Renesas Electronics and Sony. After expiration of that period, Renesas Electronics will shift the production of the system LSIs to its Naka Factory or discontinue production, as Renesas Electronics previously announced to its customers.
2. Overview of the Assets to be Transferred
3. Overview of Renesas Electronics and Sony
3. Timeline of the Asset Transfer
(1) Date of Asset Transfer Agreement: January 29, 2014
(2) Date of the Asset Transfer (planned): March 31, 2014
* This transfer is subject to the receipt of necessary regulatory approvals
4. Financial Outlook
(Renesas)
As a result of the Asset Transfer, Renesas Electronics expects to record the difference between the expected transfer price and the book value of the assets at the time of the transfer as an extraordinary loss in the third quarter of the fiscal year ending March 31, 2014. However, the amount of book value is currently being evaluated and will be disclosed once such amount is confirmed.
Renesas Electronics intends to disclose the consolidated forecasts for the third quarter of the fiscal year ending March 31, 2014 where the impact from the Asset Transfer will be included once such impact is confirmed.
(Sony)
No material impact is anticipated on Sony's consolidated financial results for the fiscal year ending March 31, 2014 as a result of the Asset Transfer.
Sony is currently evaluating its forecast of the consolidated financial results for the fiscal year ending March 31, 2014 to take into account the Asset Transfer and other factors that might affect such forecast.
In connection with the Asset Transfer, Sony today announced “Sony Establishes Yamagata Technology Center to Increase Production Capacity for CMOS Image Sensors”.
Information can be found at www.sony.net/SonyInfo/News/Press/201401/14-016E/
About Renesas Electronics Corporation
Renesas Electronics Corporation (TSE: 6723), the world's number one supplier of microcontrollers, is a premier supplier of advanced semiconductor solutions including microcontrollers, SoC solutions and a broad range of analog and power devices. Business operations began as Renesas Electronics in April 2010 through the integration of NEC Electronics Corporation (TSE:6723) and Renesas Technology Corp., with operations spanning research, development, design and manufacturing for a wide range of applications. Headquartered in Japan, Renesas Electronics has subsidiaries in approximately 20 countries worldwide. More information can be found at www.renesas.com.
About Sony Corporation
Sony Corporation is a leading manufacturer of audio, video, game, communications, key device and information technology products for the consumer and professional markets. With its music, pictures, computer entertainment and online businesses, Sony is uniquely positioned to be the leading electronics and entertainment company in the world. Sony recorded consolidated annual sales of approximately $72 billion for the fiscal year ended March 31, 2013. Sony Global Web Site: http://www.sony.net/
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