Japan's Renesas eyes $550mn savings, 5000 job cuts

Struggling Japanese chipmaker Renesas Electronics said Tuesday it is looking to save 43 billion yen ($550 million) annually, mostly by slashing at least 5,000 jobs. The company said in a statement it will offer an early retirement programme to its domestic workers, saying "we expect 5,000 and some hundreds more people to apply." It also said it will reorganise domestic production facilities to concentrate on its mainstay businesses. It will reduce output and hand over plants to other companies. The announcement comes after the company's president said last week he had won agreement for financial help from top shareholders, the technology giants NEC, Hitachi and Mitsubishi Electric, along with creditor banks. "The three top shareholders have expressed their basic agreement to our request for necessary capital. We are still discussing details and conditions," Yasushi Akao told the meeting held in Kawasaki City, near Tokyo. His comments confirmed reports that Renesas's biggest investors, which own about 90 percent of its shares, would help the firm that was created by the merger of their own chip divisions over the past decade. In May, Renesas said it would boost the outsourcing of its chip production to Taiwan Semiconductor Manufacturing Co., including a bigger share of its output of microcontrollers -- key components in vehicles and home appliances.