A former executive at French semiconductor firm ST Microelectronics is proposing a three-way merger of Europe’s three largest semiconductor companies: ST Micro of France, NXP of the Netherlands and Germany’s Infineon. But while it underscores many of the problems facing the chip industry — and makes for fun headlines! — the proposal is a ludicrous one.
Geographically-based culture differences aside, the three firms don’t need to combine — they need to focus. And their respective actions over the past few years indicate that’s just what they’re trying to do. In an effort to focus on its core markets, Infineon back in 2006 spun out its memory division, then last week it sold its hard disk drive division to LSI. In the meantime, NXP last year exited the VoIP market to focus more closely on six segments, among them consumer electronics, automobiles and cell phones.
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