Renesas to alleviate its losses with Apple deal?
The unconfirmed news which estimates Apple’s bargaining offer to around Yen50 billion ($479 million), has boosted Renesas’ shares by more than 10% at one point, compared with a 0.7% gain in the benchmark Nikkei Stock Average.
Although Renesas declined to confirm any deal, it said in a statement that it was exploring various options with this unit. Renesas SP Drivers is reportedly the sole supplier of LCD chips for Apple’s iPhones, which would consolidate Apple’s in-house resources if the deal goes ahead.
Currently, Renesas Electronics expects to log a 21.8 billion yen net loss for the just-ended fiscal year after cumulating 167.58 billion yen loss, a year earlier. Such a deal would only be a quick fix to alleviate the company’s losses.
According to Nikkei, other shareholder Sharp (with 25 percent of the venture) would also likely sell its stake to Apple if the Renesas transaction is finalized. This would force current customers to look for alternatives.
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