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ST Electronics, NEC in joint venture to provide cloud services

Veronica C. Silva | Aug. 16, 2011
Other areas of collaboration to be explored.

Two of the region's leading electronics companies recently announced that they are collaborating on several information and communications technology (ICT) initiatives aimed at expanding their reach in Asia.

Singapore's ST Electronics, the electronics arm of publicly-listed ST Engineering, and NEC of Japan recently forged a memorandum of understanding that will include setting up a joint venture worth S$6 million (US$4.9 million).

The two companies, electronics leaders in their respective countries, said the joint venture will allow the two companies to offer cloud services to organisations, initially in Singapore and eventually to the rest of Southeast Asia. The companies said they are also open to other collaborations in the future.

Toshiyuki Mineno, executive vice president and chief global business officer, NEC, said forging a joint venture with ST Electronics is part of its global strategy to expand its footprint for its cloud services.

Cloud company

NEC APAC, which has its regional headquarters in Singapore, will own a 60 percent stake in NEC STEE Cloud Services and ST Electronics (Info-Software Systems), the remaining 40 per cent. NEC STEE Cloud Services will set up a Cloud Oriented Data Centre (CODC) to offer software-as-a-service (SaaS).

NEC's CODCs feature NEC's proven technologies and core systems to offer a combination of specialised hardware products, operating systems and middleware. NEC said its data centres provide highly reliable application services that are well-suited for businesses.

''Singapore, being the Asia Pacific regional headquarters for NEC, is the ideal location to kickstart this cloud business into the region. We believe the collaboration will benefit not only both companies in expanding our territories, but ultimately, our customers who can leverage on the latest and advanced technologies provided by the two technology powerhouses,'' said  Mineno.

For ST Electronics, working with NEC ''strengthens ST Electronics' globalisation strategy in providing eco-enabling ICT solutions and cloud services to the markets in this region,'' said Lee Fook Sun, president, ST Electronics. ''We will leverage our combined strengths to provide a range of comprehensive end-to-end solutions that includes secure and efficient applications, support services and infrastructure."

ST Engineering group provides solutions and services in the aerospace, electronics, land systems and marine sectors. ST Electronics said setting up the joint venture will not significantly affect ST Engineering's  consolidated net tangible assets per share and earnings per share for the current financial year.

NEC Corporation, on the other hand, has more than 100 years' experience in technological innovations.


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