Fujitsu and Sumitomo Compound Semiconductor Joint Venture - News Item

Fujitsu Limited and Sumitomo Electric Industries, Ltd. today announced that they have reached a basic agreement to create a joint venture that will consolidate the operations of Fujitsu Quantum Devices Limited, a wholly owned subsidiary of Fujitsu that is focused on the development, manufacture and sales of compound semiconductors, with the electronic devices business of Sumitomo Electric's compound semiconductor operations. Fujitsu and Sumitomo Electric will each have an equal equity ownership in the joint venture.

The new company, which will be engaged in everything from development and manufacturing to sales of a wide variety of compound semiconductor devices, will aim to quickly establish the trust of customers worldwide as the world's leader in the field by offering a level of technological and developmental expertise unmatched by any company in the industry.

Compound semiconductor devices business has been expanding its product applications from telecommunication infrastructure market, such as equipment for fixed-line networks and wireless base stations, to such growth markets as mobile terminals, digital home appliances as well as enterprise applications, such as wireless local area networks.

Fujitsu Quantum Devices will bring to the new joint venture a broad portfolio of advanced technologies primarily geared toward the telecommunications infrastructure market, including microwave devices and optical communications devices. Combined with Sumitomo Electric's strengths in materials technologies, such as epitaxial growth, which contribute to superior device performance, the new company will quickly take a leading position in the market for microwave devices and other compound semiconductor devices, offering products that combine unparalleled performance and value.

Through the integration of the two companies' operations, the new joint venture will pursue the following strategies for growth:

  • By taking maximum advantage of the synergy from the partners' distinct strengths, the joint venture will build a powerful R&D platform, particularly in the areas of process technologies and device performance. And by bringing together the two companies' long-term R&D work in cutting-edge technologies, the new venture will be able to quickly establish an organization that can meet a wide array of sophisticated customer needs.
  • Through the integration of the two companies' R&D and manufacturing resources to maximize operating efficiency, the joint venture will have a dominant position in the market for telecommunications infrastructure devices as well as new markets with high growth prospects, such as wireless and broadband communications, digital home appliances and information terminals, and IP networking.
  • The new venture will establish a global market presence, including the key markets of the U.S., Europe, and Japan, where fiber-to-the-home and other initiatives to develop high-speed subscriber networks are being implemented, as well as China, which is undergoing explosive growth.

Fujitsu Limited, Fujitsu Quantum Devices, and Sumitomo Electric will continue to negotiate various details in order to sign a formal agreement, with an aim of having the joint venture be operational as of April 1, 2004, establishing a compound semiconductor device manufacturer with a dominant technological and competitive position to meet the needs of the global marketplace.

Posted 25th December 2003


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