Toshiba to outsource chip manufacture to rival Samsung

Toshiba said yesterday that it would outsource chip manufacture to Samsung to boost profitability under a wider restructuring plan. Toshiba uses semiconductor chips in smartphones, televisions and driving systems.

The company said it has negotiated a deal with Sony for the sale of its semiconductor facility. Sony intends to use the facility to make sensors for cameras and smartphones.

Starting next fiscal year, Toshiba would consign high-performance system LSI (large scale integration) chips fabrication to Samsung Electronics.
With the tie-up, Toshiba will be able to save on capital investment costs for plants and capacity upgrades.

According to analysts, the tie-up would allow Toshiba to focus on its flash memory business. They the company has been making losses in system chips.

They add that though it seems a positive strategy to spin off the segment, concerns about the leakage of know-how and technology by partnering with rival Samsung would remain.

 In a separate development, Toshiba said it would re-sell a semiconductor plant in Nagasaki prefecture to Sony, which it had owned until 2008.