Denso Corporation, the main component-manufacturing subsidiary of Toyota Motor Corporation, confirmed that it has withdrawn its offer to acquire local semiconductor manufacturer Rohm Company Ltd, after the two companies failed to agree on the terms of the acquisition.
Denso’s JPY 1.3 trillion (US$ 8.2 billion) offer for the company last month is understood to have fallen short of the chipmaker’s own internal valuation.
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In a formal announcement in response to recent media reports, Denso confirmed that following a meeting of its Board of Directors, it has “withdrawn its proposal regarding the acquisition of shares of Rohm Company Ltd.”
Denso currently has a stake of almost 5% in Rohm, a manufacturer of high-energy-efficiency silicon carbide power management semiconductors. Last year, the two companies agreed to collaborate on integrating Rohm’s advanced semiconductor technologies into Denso’s automotive integrated circuits (ICs).
Denso confirmed that the two companies had since “engaged in discussions with a view to broadening their collaboration,” including integrating Rohm’s semiconductor technologies into a wide range of Denso’s advanced automotive systems, from vehicle electrification to smart and connected technologies.
Denso said in a statement: “As of today, the company has not obtained the support of Rohm’s Board of Directors and Special Committee with respect to the Proposal. Under these circumstances, after comprehensively reviewing the significance of proceeding with the Proposal, its impact on the Company’s medium- to long-term corporate value, and the optimal form of the relationship between the two companies, Denso has concluded that continuing the Proposal at this time would not necessarily contribute to the enhancement of its corporate value, and has accordingly decided to withdraw the Proposal.”
Rohm, in response to media reports, stated earlier this week: “It is true that, at present, the company has not expressed its support for the proposal.” The company had previously revealed that it was planning to hold talks with Toshiba and Mitsubishi Electric on integrating their power semiconductor businesses.
