Taiwan-based IC distributors for the former NEC Electronics and Renesas Technology may undergo consolidation of their distributed products for Renesas Electronics, formed as a result of the two Japan-based chip vendors' merger, according to market sources. Competition for the new company's distribution rights will also heat up.

NEC Electronics and Renesas previously had a total of around 10 sales agents in Taiwan, including Audix, Koryo Electronics, Sentronic International, Asec International and Silicon Application. Most of the distributors also run sales offices in other parts of Asia, including China, Hong Kong and Southeast Asian countries.

With the IC component industry becoming more consolidated, downstream distributors are looking at merging with or acquiring smaller peers in order to stay competitive. Consolidation among Taiwan's IC distributors has taken place over the past several years, with the most recent one being a merger between WPG Holdings and Yosun Industrial.

Renesas Electronics began operation on April 1, 2010. The company said it will focus on microcontrollers, SoC solutions, and analog and power devices. In addition, it will strengthen marketing and product development for a growing green market, such as smart grids, eco-friendly devices and green vehicles, and for emerging markets including China and India.