As it announces the acquisition of the Radio Frequency (RF) components business of Japan-based Renesas Electronics Corporation for a cash consideration of $36 million, CG Power and Industrial Solutions will enter the semiconductor design market.
According to a BSE filing, on October 4, 2024, CG and Renesas Electronics America, a subsidiary of Renesas, and other connected entities that have assets in the RF components industry, entered an asset acquisition agreement.
In accordance with the agreement, the Murugappa Group company CG Power will purchase tangible assets, intellectual property (IP), and choose to transfer workers across several departments including applications, marketing, and semiconductor design connected to Renesas RF components business.
For its Outsourced Semiconductor Assembly and Test (OSAT) business, CG Power founded CG Semi Private Limited. CG Semi Private Limited is a joint venture between CG and Renesas Electronics America Inc.
The proposed acquisition will allow the company to enter the semiconductor design industry. For its Outsourced Semiconductor Assembly and Test (OSAT) business, CG Power founded CG Semi Private Limited. CG Semi Private Limited is a joint venture between CG and Renesas Electronics America Inc.
As per the deal, Renesas RF components business will have its Intellectual Property (IP), physical assets, and certain staff, including those involved in semiconductor design, marketing, and applications, transferred to CG Power, a company under the Murugappa Group.
The company will be able to enter the semiconductor design market thanks to the proposed acquisition. CG Semi Private Limited is a subsidiary of CG Power that caters to the Outsourced Semiconductor Assembly and Test (OSAT) sector. CG Semi Private Limited is a joint venture between CG and Renesas Electronics America Inc.
According to the announcement, entities created by CG will purchase the company once they have satisfied all requirements and received all necessary regulatory clearances.
If the required clearances are obtained, the transaction is anticipated to be finished in roughly six months.
“Indians make up a sizable portion of the world’s semiconductor design workforce. Vellayan Subbiah, Chairman of CG Power and Industrial Solutions, stated, “With this acquisition, we hope to strengthen India’s position in the semiconductor design and development space, which is thought to be a high-growth and high-profitability sector.”
According to Renesas’ Senior Vice President and General Manager of the Analog and Connectivity Group, Davin Lee, this partnership will allow the company’s RF team to grow.
“CG will supply great RF technology and world-class service to our clients, and we will assist a smooth transition to facilitate the same. Renesas is able to further scale in order to better meet customer demand since this move sharpens our focus on the strategic portion of our analog and connectivity business, Lee continued.
