Renesas Electronics Announces Appointment of CFO Hidetoshi Shibata as New CEO

According to an official announcement from Renesas Electronics, Renesas Electronics (Tokyo Stock Exchange: 6723), a major supplier of semiconductor solutions, recently announced that the current CEO Bunsei Kure will resign as its representative director, president and CEO on June 30, 2019, and Hidetoshi Shibata will become its representative director, president and CEO, and the appointment will take effect from July 1, 2019.

Hidetoshi Shibata, New President and CEO of Renesas Electronics

New President and CEO Shibata joined Renesas in 2013 when the company was in the midst of a financial crisis. As executive vice president, board member and chief financial officer, Shibata led the company's structural reforms, including personnel cost reduction and production restructuring. In addition, he also played an important role in the acquisition of two US semiconductor companies, Intersil and IDT.

Renesas officially announced the reasons why the board of directors chose Shibata as the next president and CEO as follows: "We highly value Shibata's leadership experience in structural reforms, which will enable him to use the lessons learned to quickly take effective measures to get out of the current unfavorable operating performance and stock price decline. In today's rapidly changing semiconductor era, for the reconstruction and further development of the company, we believe that he is most qualified to become the next president and CEO."

The board of directors pointed out that in view of Renesas' current unsatisfactory performance and the huge difference with the financial goals set in mid-2016, the nomination committee began to evaluate the performance of the current CEO Wu Wenjing two months ago. The nomination committee is a voluntary advisory body that reports to the board of directors. Considering the company's recent situation and the trends of its competitors, the committee believes that it is necessary to change the management to adapt to future development needs.

Regarding this appointment, Hidetoshi Shibata pointed out in an official statement : "Although we are facing short-term challenges, I believe that Renesas is still in a good position in key markets and can continue to create innovative and sustainable solutions for our customers and society as a whole. I would like to thank the board of directors for its support. It is an honor to lead Renesas together with my hard-working colleagues to continue to provide industry-leading solutions to customers and actively complete the integration process of IDT. I hope that we can work together to regain confidence in growth and create more value for the company."

Biography of Shibata Hidetoshi

Renesas restructuring in progress

After the Great Earthquake in Japan in 2011, Renesas' production was affected to some extent. In 2013, the company accepted investment from the Japan Industrial Innovation Agency, and Shibata Hidetoshi was sent by the major shareholder to serve as CFO.

From Shibata's work, it can be seen that he had worked in the financial field for less than 20 years before being directly transferred to Renesas, where he was responsible for several major mergers and acquisitions and various restructurings, and was recognized by the board of directors.

Since 2013, Renesas Electronics has achieved sustained growth as the overall industry has improved. However, in the past year, changes in external industry influences have also brought shocks to Renesas and the entire semiconductor industry.

According to Techsugar's report on March 6, 2019, Renesas plans to suspend production worldwide for one month to cope with the reduction in demand from the Chinese market. Renesas said that due to the sharp decline in automobile and machine tool sales in the Chinese market, which exceeded expectations, it had to suspend production to adjust inventory. The suspension time will be scheduled between April and September 2019, of which six factories in Japan will be suspended for as long as two months, during the Golden Week in May and the summer vacation in August. Renesas has notified all customers of this news. The

Core Thought Research Institute believes that it is precisely because of the integration process of Hitachi, Mitsubishi and NEC Electronics that Renesas Electronics has been left with too much production capacity and inefficient production lines, which has left many hidden dangers for Renesas Electronics' operations. Next, Renesas Electronics will also close or sell up to three wafer fabs. It is estimated that this temporary suspension of production will also pave the way for the next integration of production plants.

Shibata Hidetoshi's four main work focuses

Based on Renesas' previous performance and trends, EEWORLD reporters made the following guesses about Hidetoshi Shibata and Renesas' next steps:

For Hidetoshi Shibata, who has a background in finance, optimizing production capacity and financial statements will remain his top priority.

Secondly, as car sales are declining, how to develop sales and business partnership plans for Renesas in the automotive market, regain market growth confidence and customer orders, and ensure that Renesas' performance is stable and upward is the second major focus.

The third is to complete the integration work after the acquisition of IDT. Compared with Intersil, IDT is larger in size and has more abundant products. How to smoothly integrate IDT, Intersil and Renesas' traditional flagship products, give full play to the synergy and expand the potential market size will be its more important and long-term work focus.

Fourth, with the strength of the major shareholder behind it, whether there will be a new round of M&A plans, including further integration of the automotive and industrial sectors, I guess the board of directors has also given some expectations.

It is hoped that the young and energetic representative of the younger generation, Hidetoshi Shibata, can inspire younger and more vibrant energy in Renesas and give this historic semiconductor company a new life.