Apple Looking to Purchase Majority Stake in Japanese Chip Maker for iPhone Screens

Apple sees Samsung in a position of greater control over its supply chain, and seems to be working toward similar goals with a potential majority stake purchase of a Japanese chip venture. 

According to Reuters, Apple is currently in talks to purchase a 55 percent stake in Renesas Electronics Corp’s chip division — called Renesas SP Driver. 

Renesas is a loss-making Japanese chipmaker that is currently in the midst of a restructuring process that will swing focus to its core auto business. Renesas has totaled nearly 650 billion yen ($6.28 billion USD) in net losses over the last eight years.

But Renesas supplies smartphone screen chips for Sharp, Japan Display Inc and LG Display Co Ltd. — which all happen to make iPhone displays. Hence, Apple’s majority stake purchase would mean that it could have greater control over costs, product information, production schedules and specifications. 

This is a main advantage for Apple’s top mobile competitor Samsung, which makes its own Galaxy components like screens, chips and capacitors. Perhaps Apple can put itself in a better competitive position against the Android-powered hardware maker with some control over its supply chain as well. 

In addition, Apple likely won’t want the competition to jump in and buy the majority stake instead. 

The Reuters report claimed that Apple could pay 50 billion yen ($483 million USD) by this summer for the 55 percent stake in the screen chip company. 

Sharp Corp owns a 25 percent stake in Renesas as well, while Taiwan’s Powerchip owns the remaining stake. It’s possible that Apple might go after their stakes in the company as well.