KKR suffers Renesas buyout blow after government-backed fund agrees deal

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Global buyout giant KKR’s attempt to buy ailing Japanese computer chip maker Renesas has suffered a blow after a government-backed fund agreed to buy a majority stake, it is understood.

Japanese state-backed Innovation Network Corp will pay about JPY180bn ($2.2bn) for the company through a consortium backed by Toyota and Panasonic according to a report in the Financial Times.

That is less than an earlier reported figure of $2.55bn, which came amid KKR withdrawing its previously tabled offer in mid-October.

The investment will speed up the listed company’s restructuring process and provide a lifeline as it battles against foreign rivals and lower prices.

The company is understood to be planning a restructuring which would see it lay off thousands of its workforce and sell half of its domestic plants.

Renesas agreed to 5,000 fresh job cuts as part of the rescue deal, the FT said, in addition to about 7,500 employees agreeing to take early retirement in October as part of a previous round of cuts.

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