|By Business Wire||
|December 10, 2012 02:27 AM EST||
Renesas Electronics Corporation (TSE: 6723, hereinafter “Renesas”), a premier supplier of advanced semiconductor solutions, has been implementing a range of measures to strengthen its earnings base and financial foundation, as outlined in press releases issued on July 3, 2012 and September 28, 2012, respectively titled “The Direction of Various Measures to Establish Robust and Profitable Structure”, and “The Progress of Various Measures to Establish Robust and Profitable Structure”.
In working to strengthen the company’s earnings base, since the merger on April 1, 2010 Renesas has been pursuing integration synergies, and building on its dominant number one position worldwide in the microcontroller (MCU) market by optimizing our business portfolio and streamlining the manufacturing structure among a range of other such measures. Steady implementation of these measures has produced tangible results, including an approximate 20% reduction in fixed costs in the last two years.
However, after considering the impact of the 2011 Great East Japan Earthquake, along with the impact of global economic uncertainty, Renesas determined that further measures were necessary to respond to dramatic changes in the global economic circumstances and domestic operating environment. Accordingly, following an announcement on July 3, 2012, Renesas has been implementing additional business and structural measures, centered on an early retirement incentive program and significant restructuring of domestic production sites.
The early retirement incentive program, as outlined in Renesas’ announcement of October 16, 2012, received 7,446 applications, and all applicants retired as of October 31. The restructuring of domestic production sites has been proceeded as planned, including an agreement to transfer Renesas High Components (Aomori Factory) to AOI ELECTRONICS CO., LTD. as announced on October 12, 2012. Renesas intends to continue efforts to create a lean organization and management structure, and under the current management framework the company is planning to pursue further rationalization initiatives to boost competitiveness, including further optimization of the personnel structure.
In terms of strengthening the company’s financial foundation, on September 28, 2012 Renesas announced new financing totaling 97 billion yen from major shareholders and main banks. Renesas also entered into an agreement for a syndicated loan totaling 161.1 billion yen, arranged by the main banks, which allows the company to convert short-term debt to long-term debt and secure stable long-term funding. Through these initiatives Renesas has secured sufficient funding for the foreseeable future to enable implementation of ongoing structural reforms.
Today, as detailed in a press release titled “Renesas Electronics Announces Share Issue through Third-Party Allotment, and Change in Major Shareholders, Largest Shareholder who is Major Shareholder, Parent Company and Other Related Companies”, Renesas announced a decision to issue 150 billion yen in shares through third-party allotment to The Innovation Network Corporation of Japan (hereinafter “INCJ”), Toyota Motor Corporation, Nissan Motor Co., Ltd., Keihin Corporation, Denso Corporation, Canon Inc., Nikon Corporation, Panasonic Corporation and Yaskawa Electric Corporation, with the aim of establishing a financial foundation resistant to rapid changes in the global economy and domestic business environment and investing in core business areas for growth to enable a recovery in performance. Details of the third-party allotment are available in the aforementioned press release.
In the emerging Smart Society brought about by the increasing pace of network connectivity in electronic equipment and social infrastructure, control systems that embed MCUs and IT equipment using SoCs are rapidly converging. Therefore, the new market for control systems based on MCUs is expected to expand. As this transition progresses simultaneously in advanced and developing countries, an extremely large new market will be created for the semiconductor industry to exploit. By strengthening its earnings base and financial foundation, Renesas aims to respond to these changes in the market and construct high value-added MCU-based kit solutions for customers with further strengthened Analog and Power semiconductors, which are essential to the kit solutions, while improving its competitiveness in SoCs. Renesas will realize growth in this new market by supplying platforms that combines these kit solutions with software including IPs and OS commonly used for each application, contributing to shorter development periods, increased cost competitiveness and productivity for customers.
Renesas plans to use funds raised from this capital increase by third-party allotment to realize its goal of growth in the Smart Society through investment in the five areas outlined in the table below. Based on this, Renesas seeks to ensure sales growth in these strengthened areas, and achieve stable profits, while increasing corporate and shareholder value.
[Specific Use of Funds Raised through Third-Party Allotment]
(millions of yen)
|Planned outlay period|
|(i)||Investment related to leading-edge process development of MCUs and standardization of development basis||40,000||June 2013 to March 2017|
Capex related to production
(sample and mass production)
|20,000||June 2013 to March 2017|
|(iii)||Investment in automotive semiconductor solutions||40,000||June 2013 to March 2018|
|(iv)||Investment in industrial semiconductor solutions||40,000||June 2013 to March 2017|
|(v)||Development investment for rebuilding the management base||10,000||June 2013 to March 2016|
(1) Strengthen core competencies
To strengthen the company’s core competencies, Renesas must first invest in the development of the latest 28nm MCU process technology and in the standardization of development basis as stated in (i) above, taking steps to maintain our dominant leadership of the global MCU market. Regarding capex related to production (sample and mass production) as stated in (ii) above, capex will be pursued to increase the profitability of existing processes currently in mass production and to improve competitiveness of the latest processes currently under development. Along with these investments, Renesas will also invest for applying finer process nodes and larger wafers to analog products, thereby improving product competitiveness.
(2) Strengthen semiconductor solution provision capabilities
In relation to investment (iii) and (iv) above, namely, investment in automotive and industrial semiconductor solutions, Renesas will strengthen its Analog & Power semiconductor technological capabilities, which are indispensable to kit solution proposals for customers, centered on our existing dominant leading market share in MCUs, as well as to pursue M&A and collaborations in Analog & Power semiconductors to enhance the product line up. In addition, as a means of increasing the ability to provide compelling solutions, Renesas will investigate M&A and collaboration with the makers of embedded operating systems and with IP vendors, and will also consider M&A with independent design houses in emerging economies.
Renesas will also pursue business expansion in semiconductor markets with high growth potential, including HEV and EV and various vehicular information systems in the automotive sector, smart-grid technology in the industrial sector, and also in the area of new electronic controls equipment that is being driven by the progress of network connectivity of electronic equipment and social infrastructure in the emerging Smart Society, as noted above.
(3) Increase resistance to rapid market changes
In relation to investment (v) above, namely, development investment for rebuilding the management base, one of the aims is to improve the business evaluation system to speed up decision-making in response to sudden market changes. Another is to improve resistance to seismic activity for manufacturing equipment, establishing multi-fab production for creating a more robust business continuity plan (BCP) to ensure the stable supply of products to customers.
Through this growth investment, which is necessary to survive and prosper amid tough global competition, Renesas will strive to enhance core competencies that differentiate its business from competitors and achieve a rapid improvement in profitability. In the mid-and-long term, Renesas aspires to develop its platform business, strengthen semiconductor solution provision capabilities and optimize customers’ systems, thereby contributing to sales growth in core areas, higher profitability, and improved corporate and shareholder value in the future.
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 20 countries worldwide. More information can be found at www.renesas.com.
In a world of ever-accelerating business cycles and fast-changing client expectations, the cloud increasingly serves as a growth engine and a path to new business models. Dynamic clouds enable businesses to continuously reinvent themselves, adapting their business processes, their service and software delivery and their operations to achieve speed-to-market and quick response to customer feedback. As the cloud evolves, the industry has multiple competing cloud technologies, offering on-premises ...
May. 5, 2015 12:00 AM EDT Reads: 3,065
DevOps Summit, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developmen...
May. 4, 2015 11:45 PM EDT Reads: 556
While Docker continues to be the darling of startups, enterprises and IT innovators around the world, networking continues to be a real mess. Indeed, managing the interaction between Docker containers and networks has always been fraught with complications. Without automation in networking, the vision of running Docker at scale and letting IT run the same apps unchanged on the laptop and in the data center or for any cloud cannot be realized.
May. 4, 2015 11:30 PM EDT Reads: 669
SYS-CON Events announced today Isomorphic Software, the global leader in high-end, web-based business applications, will exhibit at SYS-CON's DevOps Summit 2015 New York, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Isomorphic Software is the global leader in high-end, web-based business applications. We develop, market, and support the SmartClient & Smart GWT HTML5/Ajax platform, combining the productivity and performance of traditional desktop software ...
May. 4, 2015 10:00 PM EDT Reads: 634
DevOps Summit 2015 New York, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that it is now accepting Keynote Proposals. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development cycles that produce software that is obsolete...
May. 4, 2015 07:00 PM EDT Reads: 4,331
Application metrics, logs, and business KPIs are a goldmine. It’s easy to get started with the ELK stack (Elasticsearch, Logstash and Kibana) – you can see lots of people coming up with impressive dashboards, in less than a day, with no previous experience. Going from proof-of-concept to production tends to be a bit more difficult, unfortunately, and it tends to gobble up our attention, time, and money. In his session at DevOps Summit, Otis Gospodnetić, co-author of Lucene in Action and founder...
May. 4, 2015 07:00 PM EDT Reads: 2,105
“The year of the cloud – we have no idea when it's really happening but we think it's happening now. For those technology providers like Zentera that are helping enterprises move to the cloud - it's been fun to watch," noted Mike Loftus, VP Product Management and Marketing at Zentera Systems, in this SYS-CON.tv interview at Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
May. 4, 2015 06:45 PM EDT Reads: 3,403
“We are a managed services company. We have taken the key aspects of the cloud and the purposed data center and merged the two together and launched the Purposed Cloud about 18–24 months ago," explained Chetan Patwardhan, CEO of Stratogent, in this SYS-CON.tv interview at 15th Cloud Expo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
May. 4, 2015 06:30 PM EDT Reads: 2,930
SYS-CON Events announced today that CenturyLink, Inc., a leader in the network services market, has been named “Platinum Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. CenturyLink is the third largest telecommunications company in the United States and is recognized as a leader in the network services market by technology industry analyst firms. The company is a global leader in cloud infrastructure and ...
May. 4, 2015 04:15 PM EDT Reads: 1,144
Database apps on mobile devices shouldn't stop working when there's limited or no network connectivity. In his session at 16th Cloud Expo, Bradley Holt, a Developer Advocate for IBM Cloudant, will discuss how to bring data stored in a cloud database to the edge of the network (and back again), whenever an Internet connection is available. He will demonstrate techniques for replicating cloud databases with mobile devices in order to build offline-enabled mobile apps that can provide a better,...
May. 4, 2015 04:00 PM EDT Reads: 980
In his session at 16th Cloud Expo, Simone Brunozzi, VP and Chief Technologist of Cloud Services at VMware, will review the changes that the cloud computing industry has gone through over the last five years and share insights into what the next five will bring. He will chronicle the challenges enterprise companies are facing as they move to the public cloud. He will delve into the “Hybrid Cloud” space and explain why every CIO should consider ‘hybrid cloud’ as part of their future strategy to a...
May. 4, 2015 03:46 PM EDT Reads: 637
"Blue Box has been around for 10-11 years, and last year we launched Blue Box Cloud. We like the term 'Private Cloud as a Service' because we think that embodies what we are launching as a product - it's a managed hosted private cloud," explained Giles Frith, Vice President of Customer Operations at Blue Box, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
May. 4, 2015 02:30 PM EDT Reads: 3,638
Puppet Labs on Wednesday released the DevOps Salary Report, based on salary data gathered from Puppet Labs' industry-recognized State of DevOps Report. The data confirms that market demand for DevOps skills is growing, and that DevOps engineers are among the highest paid IT practitioners today. That's because IT organizations today are grappling with how to be more agile and responsive to the business, while maintaining the stability of their infrastructure. DevOps practices, such as continuous ...
May. 4, 2015 02:15 PM EDT Reads: 2,214
"SOASTA built the concept of cloud testing in 2008. It's grown from rather meager beginnings to where now we are provisioning hundreds of thousands of servers on a daily basis on behalf of customers around the world to test their applications," explained Tom Lounibos, CEO of SOASTA, in this SYS-CON.tv interview at DevOps Summit, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
May. 4, 2015 02:15 PM EDT Reads: 3,463
Docker is becoming very popular--we are seeing every major private and public cloud vendor racing to adopt it. It promises portability and interoperability, and is quickly becoming the currency of the Cloud. In his session at DevOps Summit, Bart Copeland, CEO of ActiveState, discussed why Docker is so important to the future of the cloud, but will also take a step back and show that Docker is actually only one piece of the puzzle. Copeland will outline the bigger picture of where Docker fits a...
May. 4, 2015 02:15 PM EDT Reads: 5,240