TOKYO (AP) -- Renesas Technology Corp. and NEC Electronics Corp. will combine operations by April after their Japanese parent companies agreed to inject 200 billion yen ($2.2 billion) into a new company that would become the world's No. 3 chipmaker.
After the deal is completed, NEC Corp., the parent of NEC Electronics, will have 33.4 percent stake in the new company -- Renesas Electronics Corp., the companies said in a statement Wednesday.
Existing Renesas Technology shareholders Hitachi and Mitsubishi Electric will own 30.7 percent and 25.1 percent respectively.
The combination will be between near-equals with each NEC Electronics share worth 1.189 share in Renesas Technology.
Japanese chipmakers have been battered by the global slowdown, intensifying competition and plunging prices. They have been cutting jobs and production.
Through the deal, the companies hope to grow more competitive in large-scale system integrated circuits, which are used in digital appliances, as well as other new business.