The fabless venture will open for business in October 2014. Once established, it will have some 3000 employees and annual sales of around €1billion. Yasuo Nishiguchi, former president of Kyocera, has been named as its CEO.
News of the merger, the latest in a number of attempts to rationalise Japan's semiconductor industry, comes just six weeks after Fujitsu announced it was dissolving a joint venture with NEC and NTT to build chips for smartphones.
The companies said in a joint statement: "In recent years … as market conditions have rapidly deteriorated and overseas semiconductor manufacturers have risen in prominence, the system LSI businesses of Fujitsu Semiconductor and Panasonic have been facing a severe business environment.
"In light of this situation, Fujitsu and Panasonic have both come to acknowledge that bringing together their respective advanced technologies and customer bases is vital to build a competitive business globally. Focusing on system LSI marketing, design and development under a fabless model, Fujitsu and Panasonic aim to achieve future growth in system LSI businesses."
Fujitsu and the Development Bank of Japan will each take a 40% share of the new venture, with Panasonic holding the remaining 20%. The company will operate independently.
