Apple Appears Set to Lose Bid for iPhone Display Chip Maker to Synaptics

Tuesday May 27, 2014 11:53 AM PDT by Juli Clover
Back in April, rumors indicated Apple was in talks with chipmaker Renesas Electronics over the potential acquisition of its Renesas SP Drivers division, which produces chips for smartphone displays including for the iPhone.

As it turns out, Renesas Electronics appears set to sell its stake in Renesas SP Drivers to Synaptics, another chip manufacturer, instead of Apple. According to Reuters, the talks between Apple and Renesas "failed to make progress", leading Renesas to move forward with Synaptics. Apple was originally offering 50 billion yen or $479 million for Renasas' 55 percent stake in the company, which is also partially owned by Sharp and Powerchip.
Apple Inc had also been in talks about a possible purchase of the stake in Renesas SP Driver in what was seen as a potential move to shore up its global supply chain, but the sources said those talks failed to make progress and Renesas had narrowed its consideration to Synaptics.
Apple currently uses chips from Renesas Electronics in its iPhone displays, improving both image sharpness and battery life. It is unclear how a failed acquisition would affect the ongoing relationship between the two companies.

apple_renesas_synaptics_logos
While Reuters suggests that the deal between Renesas and Synaptics is all but certain, Nikkei claims that Apple is still interested but that pricing was a major obstacle.
Apple still seems interested in acquiring the unit. Renesas "hopes to reach an agreement with Synaptics on the sale and will continue to try to persuade Apple to give in," a person familiar with Renesas' plans said.
Renesas was also reportedly convinced by some of its non-Apple customers that their access to the company's components could be cut off if Apple were to acquire the division, driving Renesas to give an edge to Synaptics.

Despite the possible failure to purchase Renesas SP Drivers, Apple's effort is part of a trend that has seen the company take a keen interest in controlling its own production supplies and core technologies in recent years. Apple recently signed a deal with sapphire producer GT Advanced Technologies and has also purchased several chip firms in the past, including P.A. Semi and Passif Semiconductor.

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Posted: 26 weeks ago

Apple was originally offering 50 billion yen or $479 for Renasas' 55 percent stake in the company


We can see why that offer might have seemed a little low.
Rating: 12 Votes
Posted: 26 weeks ago
I'll top their offer and bid $480!
Rating: 2 Votes
Posted: 26 weeks ago
Thanks for spotting the error, folks. :)
Rating: 2 Votes
Posted: 26 weeks ago

I'll top their offer and bid $480!


Throw in a couple of iPhones and you've got a deal.
Rating: 1 Votes
Posted: 26 weeks ago
Don't confuse valuation with revenue with profit.

Beats has never earned a PROFIT of $1.5 billion per year. It might sell $1.5 billion worth of headphones. But, with that $1.5 billion in revenue they have to pay to make the headphones they sell, advertise, run the company, etc.

Beats as a company is valued somewhere between $1 billion and $1.5 billion.

I'm sure this chipmaker is not bringing in 1.5 billion a year with high margins like beats. Chips is a low profit market and this was for only a 55% stake. I'm sure their purpose was to make sure a competitor didn't get them. I don't think they will mind if this company does.

Rating: 1 Votes
Posted: 26 weeks ago
Wow. I didn't know Japan had fallen on such hard times. I'd better take my American dollars and head over there.

Apple was originally offering 50 billion yen or $479 for Renasas'


On a more serious note: Apple can't pony up the dough for a chip maker but is allegedly ready to buy beats for billions?
Rating: 1 Votes

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