Rohm Co.'s stock fell sharply after Denso Corp. signaled it may withdraw its takeover proposal for the power chip maker. The potential deal collapse threatens Japan's efforts to consolidate its fragmented semiconductor supply chain.
Rohm shares dropped as much as 16% following Denso's announcement that it is reconsidering the acquisition. The Japanese automotive supplier had proposed taking over Rohm, a major power chip manufacturer, in a bid to strengthen Japan's semiconductor industry amid global competition.
Denso's hesitation marks a setback for consolidation efforts in Japan's chipmaking sector, which remains fragmented compared to rivals in South Korea, Taiwan, and the U.S. Industry observers had viewed the Denso-Rohm deal as a significant step toward streamlining the country's power electronics capabilities.
The reasons for Denso's reconsideration were not immediately detailed. The potential withdrawal leaves Rohm's future uncertain and could prompt discussions about alternative partnerships or restructuring within Japan's semiconductor ecosystem. The move reflects broader challenges facing Japanese chipmakers in competing globally while navigating capital-intensive manufacturing operations.
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