Renesas Electronics to Shelve New Share Issue
06/07/2012| 08:56pm US/Eastern
Embattled Japanese chip maker Renesas Electronics Corp. (6753.TO) will shelve plans to issue ¥100 billion in shares via private a placement to its main stakeholders, NEC Corp.(6701.TO), Hitachi Ltd. (6501.TO), and Mitsubishi Electric Corp. (6503.TO) to be debt guarantors for bank loans, the Mainichi Shimbun reported Friday.
The change of plans came after Renesas' share sale proposal met with strong opposition from the three companies, the report said. Renesas is slated to draw up a restructuring plan by the end of the month and meet with creditors.
Renesas logged its second straight year of losses in the fiscal year ending March 2012, announcing a drastic restructuring plan, including a job cuts of about 12,000 employees, or 30% of its workforce.
The private placement fundraising plan was designed to help the firm meet the costs incurred from its restructuring efforts, and was proposed by Renesas president Yasushi Akao earlier this month.