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Renesas, TSMC Extend Cooperation on Developing Automotive Chips

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May 28 (Bloomberg) -- Renesas Electronics Corp. and Taiwan Semiconductor Manufacturing Co. will extend an agreement to cooperate on developing and manufacturing microcontrollers used in cars and DVD players.

TSMC, the world’s largest custom chipmaker, will make 40-nanometer chips for Kanagawa, Japan-based Renesas, expanding a deal to produce 90-nanometer units, the companies said in a press release today.

The announcement comes as Renesas, the world’s biggest maker of automotive microcontrollers, was said to be planning to raise capital of 100 billion yen ($1.3 billion) and eliminate more than 10,000 jobs, according to the latest draft of a restructuring plan, a person briefed on the matter said May 25.

The Japanese chipmaker presented the proposal this week to its workers’ union and lenders Mitsubishi UFJ Financial Group Inc. and Mizuho Financial Group Inc. The job cuts would amount to almost a quarter of the company’s 42,800-strong workforce as it seeks to return to profit.

To contact the reporter on this story: Mariko Yasu in Tokyo at myasu@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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