Renesas sells $1.8b in shares to INCJ-led consortium
Ailing Japanese chip-maker Renesas will sell JPY150 billion ($1.8 billion) of new shares to a consortium led by government-backed Innovation Network Corporation of Japan (INCJ).
According to a press release, the 1.25 billion shares will be purchased by the consortium at JPY1.20 apeice. Shares in the Tokyo-listed company have since climbed to JPY340, their highest price since July 5.
INCJ will acquire 69% of the company though the purchase of 1.15 billion shares. Other investors include Toyota, Nissan, Keihin Corporation, Denso Corporation, Canon, Nikon, Panasonic and Yaskawa Electric.
The bailout will help Renesas, which supplies Apple and Nintendo, to boost spending to develop more advanced microcontrollers to be used in cars and TVs.
The deal, which was reported by AVCJ in October, blocked earlier plans by KKR to invest JPY100 billion in the company.
The Japanese chipmaker has struggled amid failing demand, a strong yen and competition from companies such as Samsung. In its statement the company added it had suffered from the compounded effects of the global financial crisis, the Great East Japan Earthquake, last year's flooding in Thailand, the European fiscal crisis and the slowdown in China's economy.
The company revealed it may get an additional JPY50 billion of investment from INCJ if more funds are needed.
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