Migdal Ha’emek-based chipmaker TowerJazz Semiconductor will partner with Japan’s Panasonic to make Panasonic semiconductors for use in cars and other products. The move is expected to raise the revenues of the Israeli company by 65%. Shares of Tower Semiconductor, the U.S. subsidiary of Tower Jazz, rose 45% Friday on Nasdaq on the news.
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Three Panasonic factories in central Japan will be assigned to the joint venture, which will be 51% owned by TowerJazz, the companies said Friday. Panasonic will become a minority stakeholder in TowerJazz and its biggest client.
“From day one this joint venture ... will provide us with $400 million of annual profitable revenue,” TowerJazz Chief Executive Russell Ellwanger told Reuters. “On top of that there is substantial added capacity available in those manufacturing facilities.” Ellwanger said he hoped TowerJazz, which had a net loss of $78 million in the first nine months of 2013, would turn profitable by the fourth quarter of 2014.