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CG Power of India will acquire the RF (radio frequency) component business of Renesas Electronics of Japan for $36 million, according to company documents filed with the Bombay Stock Exchange and the National Stock Exchange of India, CG Power announced in early October this year that it has entered into a definitive agreement to acquire the RF component business of Renesas Electronics America and its affiliated entities. The acquisition will be made through one or more CG Power subsidiaries.

This transaction is not only CG Power's further expansion in the semiconductor field, but also India's important position in the global semiconductor industry chain.

CG Power, through a partnership with Thailand-based Stars Microelectronics, plans to build an outsourced semiconductor assembly and test (OSAT) facility in India with a total investment of Rs 760 crore and a daily capacity of about 15 million chips. These measures will further enhance India's semiconductor production capacity and enhance its competitiveness in the international market.

Renesas Electronics' RF components business generated approximately $56 million in revenue in 2023, including revenue from equipment, intellectual property, inventory and customer resources. Still, Renesas's overall financial health isn't ideal. In the second quarter of 2024, Renesas Electronics achieved revenue of 358.8 billion yen, down 2.7% year-on-year and up 2.0% quarter-on-quarter. Profit attributable to the owner of the parent company was 96.7 billion yen, down 22.3 per cent year-on-year and 9.2 per cent quarter-on-quarter.

The history of Renesas' RF division includes mergers and key acquisitions of predecessor companies. Renesas Electronics was formerly the merger of NEC, Mitsubishi Semiconductor and Hitachi Semiconductor. In 2017, Renesas acquired Intersil, the world's fifth largest power chip company, a step that laid the foundation for its presence in power management.

On September 11, 2018, Renesas announced the acquisition of IDT, a major analog chip manufacturer in the United States, for about $6.7 billion, and completed the acquisition on March 30, 2019. With the acquisition of IDT, Renesas has gained a significant technology and market position in radio frequency (RF), high frequency and other fields. This acquisition marks the further expansion and strengthening of Renesas in the RF sector.

Since then, Renesas has introduced new RF products to meet market demand.

CG Power's chairman Vellayan Subbiah stressed the importance of the acquisition to strengthen India in the field of semiconductor design and development. He believes that there are a considerable number of semiconductor designers in the world who are Indian, and through this acquisition, CG Power hopes to attract more talented people and promote the development of India in this field. In addition, CG Power also said that it will continue to increase investment in the semiconductor industry and maintain close cooperation with Renesas Electronics to jointly promote the research and development and application of semiconductor technology.

Davin Lee, senior vice president and general manager of Renesas Electronics Analog and Connectivity, said the acquisition will expand its RF team. He also noted that the move will strengthen the company's focus on the strategic parts of its analog and connectivity business, enabling it to further scale and better meet customer needs.

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