Mitsubishi Considers Bid for Fujitsu’s Chip Unit Shinko Electric
Mitsubishi’s Potential Entry Into Semiconductor Manufacturing
Mitsubishi Corp, owned 8.3% by Warren Buffett’s Berkshire Hathaway, is exploring the possibility of entering the semiconductor manufacturing industry by considering a bid for Fujitsu’s chip packaging unit, Shinko Electric Industries. This move comes as Japan’s top trading house aims to diversify its portfolio.
Fujitsu’s Stake in Shinko Electric Up for Sale
Fujitsu has put its 50% stake in Shinko Electric, valued at around $2.6 billion, up for sale. Potential buyers interested in this opportunity include global buyout firms Bain Capital, KKR, Apollo Global Management, and government-backed Japan Investment Corp.
Potential Joint Bid
Mitsubishi plans to make a joint bid with one of the potential buyers, although discussions are still at an early stage, and a partner has not yet been decided upon.
Mitsubishi’s Response
A spokesperson from Mitsubishi confirmed that the company has set up a division exploring opportunities in chips and materials but declined to comment on individual deals.
Fujitsu’s Perspective
A Fujitsu spokesperson stated that while they are considering various options to maximize the value of the independent business, nothing has been decided at this time.
Security Concerns and Revitalizing Japan’s Semiconductor Industry
The sale of Shinko Electric, a major supplier to chip companies like Intel and Advanced Micro Devices, may face national economic security issues. However, this potential deal could also contribute to Japan’s efforts to revitalize its semiconductor industry, which had once dominated the global market but later lost ground.
Japan’s Strategic Investments in Chips
Japan has designated chips as “specified critical materials” and is providing subsidies to boost its ability to produce advanced chips. Recent investments in the chip industry include Taiwan Semiconductor Manufacturing Co (TSMC) building a $7 billion chip plant on Kyushu island and Japan’s state-backed Rapidus developing a chip plant in Chitose. Additionally, Japan is arranging subsidies for Samsung Electronics to potentially set up chip facilities.
Overall, Mitsubishi’s potential bid for Fujitsu’s chip unit reflects the company’s interest in diversifying its business and entering the semiconductor manufacturing industry. This move aligns with Japan’s efforts to strengthen its position in the global chip market and revitalize its semiconductor industry.
