Two of the world's largest chip makers plan to buy out a third partner in their joint venture Singapore chip company, the trio said Thursday.
NXP Semiconductors, formerly the chip division under Koninklijke Philips Electronics, and Taiwan Semiconductor Manufacturing (TSMC) will buy up the remaining 17.5 percent stake in the Singapore chip maker that they do not already own from EDB Investments.
NXP, which already holds a 50.5 percent stake in the chip company, Systems on Silicon Manufacturing (SSMC), said it will pay up to US$185 million for the entire 17.5 percent shareholding, but that TSMC has a right to a portion of the shares.
A deputy spokesman for TSMC, the world's largest contract chip maker, said it will purchase a portion of the shares but it has not yet decided how much. TSMC has the right to buy up to a 6.8 percent share, which would leave the remaining 10.7 percent stake to NXP.
NXP and TSMC set up SSMC as a joint venture, with support from Singapore's Economic Development Board, which controls EDB Investments and encourages industry development in the city-state.
NXP currently owns 50.5 percent of SSMC, while TSMC holds 32 percent of the company and the remainder is in the hands of the EDB.
NXP expects to fund the purchase with cash on hand, but not specify when the transaction would be completed.
EDB Investments has already agreed to sell its stake in SSMC as long as the sale is completed by the end of this year.