Toshiba Corp. will outsource its unprofitable business of producing semiconductors for digital home appliances to Samsung Electronics Co. of South Korea as it tries to restructure its chip-related operations, according to company officials.
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Toshiba plans to engage only in designing the system large-scale integration chips so it can concentrate resources on its memory chip business, which is seeing growing demand for use in smart phones, the officials said.
The company will also sell a semiconductor plant to Sony Corp. and build a factory to produce liquid crystal panels for Apple Inc.'s iPhones.
Toshiba is holding talks with other chip makers to start outsourcing its system LSI production in fiscal 2011, the officials said.
The firm said it will restructure its system LSI business on Jan. 1 to accelerate decision-making and optimize use of management resources.
In doing so, the business will be reorganized into two divisions — one responsible for cutting-edge digital home appliances and the other for a wide range of products.
Continuing the system LSI business would require Toshiba to invest heavily because it needs state-of-the-art facilities.
By outsourcing the business, the electronics giant aims to cut investment costs and focus on producing NAND flash memory chips, the officials said.
Toshiba currently makes system LSIs at its plants in Oita and Nagasaki prefectures. After outsourcing the business, the Oita plant will make imaging sensors used in digital cameras while the Nagasaki plant will be sold to Sony.
Toshiba has agreed to sell the plant in Isahaya, Nagasaki Prefecture, owned by Toshiba and run by Nagasaki Semiconductor Manufacturing Corp., a joint venture among Toshiba, Sony and Sony Computer Entertainment Inc., to Sony, terminating their joint venture ties, Toshiba and Sony said.
They said the facilities to be transferred include the fabrication facilities and equipment for the 300-mm wafer line in Nagasaki Semiconductor Manufacturing's Nagasaki Technology Center bought by Toshiba from the Sony group in 2008.
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