Renesas, Powerchip form memory chip venture

Vantel will specialize in design of advanced memory devices

Japan's Renesas Technology and Taiwan's Powerchip Semiconductor will launch a memory-chip design joint venture in February, they said Tuesday.

Both companies will contribute engineering resources to the venture, which will be called Vantel Co. and which will specialize in design of advanced memory devices.

Vantel is expected to enable both companies to produce memory chip designs with better performance at lower cost. They said it will also enable them to "overcome the key issues they are currently facing." Renesas needs more capacity to produce advanced memory chips and Powerchip is in need of greater design capacity, said Motokazu Isozaki, a spokesman for Renesas in Tokyo.

The company will be headquartered in Tokyo and its president will be Shigeru Mori, who is general manager of Renesas' memory business unit. Powerchip will own 65 percent of Vantel and Renesas will hold the remaining 35 percent stake.

News of the joint venture comes a month after Renesas said it would take a 37 percent stake in Retronix Technologies, a subsidiary of Powerchip that specializes in system solutions. As part of the deal Renesas was due to begin jointly managing Retronix Technologies' operations in this month.

Renesas Technology itself is a joint venture of Hitachi and Mitsubishi Electric. The company was the world's sixth largest chip maker in 2006, according to a December report from iSuppli. With estimated revenue for the year of $8.2 billion the company placed ahead of several better-known names including Advanced Micro Devices and Hynix Semiconductor.

Powerchip specializes in DRAM (dynamic RAM) flash and system LSI chips and maintains strong ties with Renesas and another Japanese chip maker, Elpida Memory.