MediaTek‘s 2018 contract with the Chinese Ministry of Commerce at the beginning of the year officially lifted restrictions on the merger with Morningstar and began to accelerate internal consolidation.
As early as 2012, MediaTek has announced the acquisition of Morningstar, but since the two sides in the Chinese TV chip market share as high as 80%, the anti-monopoly review has been unable to pass. Finally, the Ministry of Commerce required the two companies to maintain a competitive relationship within three years, allowing customers to have a buffer time before completing the equity merger in February 2014.
In August of this year, MediaTek officially announced that the business part of Morningstar Semiconductor will be divided into three. In the TV chip business, it will be merged into MediaTek in the future, and will merge with MediaTek’s existing TV chip division to become MediaTek’s TV business. In terms of touch chips, it will be integrated into MediaTek Group‘s Vision Technology; set-top box chip business. It will become one of the Group’s new companies, Morningstar International Technology, and is expected to formally complete the merger on January 1, 2019.
In the TV chip business, Morningstar will be merged into MediaTek in the future and merge with MediaTek’s existing TV chip division to become MediaTek’s TV business. Market rumors will be due to the overlap of personnel and job vacancies, in the merger process will be the case of the former Morningstar Semiconductor employees further repatriation or retreat. However, after MediaTek issued a letter of appointment to the employees of the former Morningstar Semiconductor, it was confirmed that there was no expected dispatch or retreat.
In this regard, MediaTek pointed out that because of the competition in the global market and paving the way for future development, there will be no layoffs or retreats in the current situation of tight talent demand.
MediaTek also said that in the past, although it was restricted by the Ministry of Commerce of China, MediaTek and Morningstar Semiconductor were operating independently. Under the three-year ban of the Ministry of Commerce, MediaTek chose to let Morningstar operate as a subsidiary. Its own TV chip team maintained its operations, and each developed its product blueprint, customers and market. It was only deregulated in February this year.
Based on past experience in the competitive period, and later on the experience of mutual cooperation, they have fully understood each other. Under the condition that each other’s talents are excellent talents, the adaptation period after the integration will be shortened, and the competitiveness of MediaTek can be improved.
In the future, after the hardware is led by the original Morningstar Semiconductor team and others are led by MediaTek, after the merger is completed in 2019, the relevant personnel will be stationed at the MediaTek headquarters. In the face of the challenges of the external environment, MediaTek is also actively carrying out internal business consolidation to enhance competitiveness.
Looking forward to 2019, MediaTek will continue to optimize on the most critical smartphone chips to increase market share and gross profit margin. MediaTek expects gross profit margin to reach 40% in 2019, and for this operational goal, talents Joining is the key to the future development of MediaTek.
It is understood that in addition to this and Morningstar Semiconductor TV chip department will not carry out preferential or layoffs, so that all employees remain in office, MediaTek is also continuing to recruit talents to continue to strengthen the development in the industry.