Panasonic Corporation has ceased its semiconductor business operated by its subsidiary, Panasonic Semiconductor Solutions Co., Ltd. (PSCS), to Taiwanese semiconductor company Nuvoton Technology Corporation, which is under the umbrella of Winbond Electronics Corporation. The acquisition, Nuvoton said, will be an all-cash transaction.

In transferring its business to Nuvoton, Panasonic cited the growing stiff competition in the semiconductor industry with most of its competitors have been aggressive in expansions, huge investments, and reorganizations through mergers and acquisitions. It said in order to achieve sustained growth and expansion of the semiconductor business, continuous investment would be critical.

"Accordingly, it has (been) concluded that the best option would be to transfer the business to Nuvoton, which highly appreciates the Company's accumulated technical and product capabilities and therefore has a potential to lead stable growth by leveraging those capabilities," Panasonic said in a statement.

PSCS, located in Nagaokakyo City, in Japan's Kyoto, is a known leading supplier of semiconductor devices and solutions with products that focus on sensing technologies such as image sensors, image/digital signal processors, microcontroller technologies such as MCU, IC card, battery management, power management and Component technologies such as MOSFET, RF-GaN and laser diode.

Nuvoton's acquisition will expand its presence in the global semiconductor industry through greater scale and volume of semiconductor solutions. The Taiwanese company will also be in a position to capture secular growth trends in the electrification and automation of automotive and industrial fields; broaden its distribution channels and customer base to explore cross-selling opportunities; and strengthen technology platform through deeper research and development resources and a broader intellectual property portfolio. The transaction, which is expected to close by June 2020, is subject to certain closing conditions including obtaining required regulatory and certain other approvals and consents in the relevant jurisdictions.