Renesas, TSMC Extend Microcontroller Partnership

Amid rumors of mass layoffs, semiconductor supplier Renesas extends its partnership with TSMC to produce 40nm microcontrollers.

Troubled Japanese semiconductor supplier Renesas Electronics announced an extension of its partnership with semiconductor foundry TSMC, to collaborate on production of 40-nanometer embedded flash (eFlash) process microcontroller (MCU) products, while rumors over the weekend suggested Renesas could slash around 12,000 jobs and seek financing from private equity firms and company stakeholders like NEC, Mitsubishi and Hitachi.

A company spokesperson told the U.K. technology news publication The Register that the rumors of staff reduction could not be confirmed or €œregarded as fact€ currently.

According to information released in a joint statement, TSMC's process capabilities could provide Renesas with a way to integrate flash onto a single microcontroller. At 40nm process, MCU products could achieve higher speed, lower power consumption and more than 50 percent smaller die size compared to the current 90nm node, features particularly crucial for integrated MCU designs, which require a variety of system components, such as logic and memory systems to be jammed into a tiny area.

€œIn order for us to achieve further global growth, we are confident that TSMC will provide us with significant benefits in accelerated time-to-volume production and maximum flexibility in addressing the volatile fluctuation of the market demand,€ Shinichi Iwamoto, senior vice president of Renesas, said in a prepared statement. €œBased on what we have learned from the Great East Japan Earthquake last year, which brought major impacts to several of our manufacturing sites and our customers businesses, we have been accelerating the construction of the 'fab network' as part of the company's business continuity plan (BCP),€ Iwamoto continued. €œBy integrating both companies' world-leading technologies through this collaboration, we will construct a supply structure which secures consistent supply for our customers and also drives the market as a leading MCU supplier aiming to set up an ecosystem for MCUs.€

Renesas is not the only chip maker struggling-- bankrupt dynamic RAM (DRAM) supplier Japanese Elpida Memory, which filed for bankruptcy in February after incurring more than $5 billion in debt and running up a string of quarterly losses, has been looking for a rescuer€”who may take the form of U.S.-based rival Micron Technology. However, the latest DRAM market report from IHS iSuppli found Elpida ironically managed to unseat Micron from its third-place ranking in the DRAM market for the first quarter of 2012.

Meanwhile, The top two DRAM suppliers, perennial market leader Samsung and Hynix Semiconductor, posted declines in growth of 9.7 percent and 2.4 percent, while Micron dropped 3.4 percent and landed in fourth place, with revenue of $759 million, compared with Elpida€™s $780 million.