Trigence Semiconductor Inc., a Japanese chip designer part-owned by Intel Corp.’s venture-capital arm, agreed to sell a minority stake to state-run Innovation Network Corp. of Japan, three people with knowledge of the matter said.
Founded by two former Toshiba Corp. (6502) engineers, the company is raising as much as 480 million yen ($4.7 million) in the sale to INCJ, said the people, who asked not to be identified before an announcement.
Trigence has developed a chip used to play digital music without converting it into analog form, according to the Tokyo-based company’s website. The patented technology reduces power consumption by digital speakers and improves fidelity, the website shows.
The government-run fund is increasing investments in technology startups after putting funds into established Japanese firms struggling amid global competition. Last year, it invested 138.4 billion yen in Renesas Electronics Corp., a Kawasaki, Japan-based maker of chips used in cars and mobile devices, according to data compiled by Bloomberg.
INCJ spent 200 billion yen in 2012 for a 70 percent stake in Japan Display Inc., formed through a three-way merger of the liquid-crystal display making businesses of Sony Corp. (6758), Toshiba and Hitachi Ltd. Last month, it agreed to invest as much as 500 million yen in Squse Inc., a Kyoto-based maker of robotic hands able to pick up food.
The founders of Trigence will retain a majority stake in the company after INCJ’s investment, according to the people. Spokesmen for INCJ and Trigence declined to comment.
Junichi Okamura, Trigence’s chief executive officer, worked as an analog circuit designer for Toshiba and International Business Machines Corp. before helping found the chip designer in 2006, the company’s website shows. Co-founder Akira Yasuda, Trigence’s chairman, has two decades of chip-design experience including time as an analog circuit designer for Toshiba.
Trigence sold an undisclosed stake to Intel Capital (INTC), the investment arm of the world’s largest chipmaker, in 2012, according to its website. The company plans an initial public offering or sale in the next three years, one of the people said.
The company’s technology has been licensed by Clarion Co. (6796), the Japanese maker of car entertainment systems, and used in Onkyo Corp. speakers, according to its website. Trigence also expects the technology to be used in wireless speakers and headsets used with smartphones and tablets, the website shows.
INCJ was set up in 2009 to invest in technology that would make the Japan’s industries more globally competitive after electronics makers such as Sony and Panasonic Corp. saw their leadership of the industry overtaken by overseas rivals including Apple Inc. and Samsung Electronics Co.
It has completed about 60 deals, investing a total of 700 billion yen, according to its website. The fund has 280 billion yen of funds from the government and companies, and has the capacity to invest as much as 2 trillion yen backed by government guarantees, its website shows.
Last year, INCJ bought stakes in Prism Pharma Co., a Japanese drug-discovery company, and Royal Gate Inc., a Tokyo-based developer of mobile payment devices, according to data compiled by Bloomberg.
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