Japanese chipmaker Renesas in talks to buy Intersil for nearly $3 bn

Japanese chipmaker Renesas Electronics Corp today said that it is in talks to buy its US rival Intersil Corp, a move designed to strengthen its automotive chip business.

''We are considering various options for growth including'' a possible deal with the U.S. company, Renesas said in a statement.

A successful deal would see Renesas paying as much as 300 billion ($2.99 billion), Reuters today reported, citing an industry source familiar with the deal.

Intersil, which has a market cap of more than $2.1 billion, was founded in 1967 as Intersil, Inc. by Jean Hoerni to develop digital watch processors and changed its name in 1999 when it acquired the semiconductor business of Harris Corporation.

The California-based company specialises in developing highly efficient power management and precision analog integrated circuits (IC).

The company supplies a full range of power IC solutions including battery management, computing power, display power, regulators and controllers and power modules; as well as precision analog components such as amplifiers and buffers, proximity and light sensors, data converters, timing products, optoelectronics and interface products.

Its clients are in the infrastructure, industrial, automotive, military, aerospace, computing, and consumer markets.

It generates annual sales of around $522 million.

Hitachi Ltd. and Mitsubishi Electric Corp. integrated their semiconductor businesses to create Renesas Technology in 2003 and in 2010 NEC Electronics Corp merged itself with Renesas Technology Corp.

Renesas has recently restructured its unprofitable operations, and is now planning to boost its automotive chip business since automakers are seeking to develop more advanced fuel-efficient cars and automated driving technology.

Tokyo-based Renesas was last year the world's third-largest chipmaker by market share, with 9.1 per cent, according to research firm Gartner.