Spansion Inc explained the aim of purchasing the Fujitsu Semiconductor Group's business of designing and developing microcontrollers and analog semiconductors May 1, 2013.
In addition to the expansion of its product portfolio and sales, the company aims to strengthen its research and development (R&D) capabilities by obtaining distinguished engineers.
"We will accelerate the development of embedded SoCs having flash memory, microcontroller and analog/mixed signal circuit on one chip," Spansion CEO John H. Kispert said.
The acquisition of Fujitsu's business coincides with Spansion's fab-lite strategy because the Fujitsu Semiconductor Group's Aizu-wakamatsu Plant will function as a foundry that manufactures Spansion's products, he said. The two companies have signed a multi-year foundry contract. As a result, Spansion can stably supply its products while minimizing its facility investment.
The Fujitsu Semiconductor Group has been a sales representative that sells Spansion's flash memory in Japan. And, with the latest agreement, the group will also sell Spansion's microcontrollers and analog semiconductors in Japan.
Strengthening R&D capabilities
Spansion concluded a final agreement to buy the Fujitsu Semiconductor Group's business of designing and developing microcontrollers and analog semiconductors for about US$175 million (including about US$65 million for inventory) (See related article).
As a result, Spansion will be able to increase its sales by US$450 million to 550 million, Kispert said. The company expects to increase its profit by US$40 million to 60 million in 2014.
More than 1,100 employees (including about 900 engineers) will be transferred from the Fujitsu Semiconductor Group to Spansion. Also, Spansion will acquire more than 1,200 patents and more than 5,000 kinds of products. As a result, the R&D capabilities of Spansion will be drastically improved, Kispert said.
Furthermore, Spansion, which is making efforts to increase the number of its software engineers, expects to increase the number from 250 to 500 through the acquisition.