Speculation mounts regarding the future of ST-Ericsson

Mobile chipmaker ST-Ericsson has released a statement admitting it is “currently working with an external advisor in order to ensure the best possible future” for the firm. The move was a response to a report earlier in Les Echos, which specifically named JP Morgan as the partner.

ST-Ericsson’s statement continued: “Both STMicroelectronics and Ericsson support ST-Ericsson in its transformation work and remain confident that the company has a strategic position in the industry to enable the device ecosystem.”

The statement referenced the company’s new "strategic plan” that was announced in April, insisting that the vendor “is in the middle of executing on company transformation aiming at lowering its break-even point.”

The Les Echos report claimed one scenario would see the venture sold in blocks related to specific technologies such as connectivity, power management and software architecture. Other pieces of the business could be shifted back into the parent companies, the paper said. The French report expects a decision to be made before the end of this year.

ST-Ericsson is a 50/50 joint venture between Ericsson and STMicroelectronics. Its poor financial health has made it a long-running target for media speculation surrounding its future. In March it was suggested that companies such as AMD, Nvidia, Intel and Texas Instruments see the value in ST-Ericsson, as a tool to rival Qualcomm in the mobile space.

In July ST-Ericsson announced a second quarter loss of US$318 million, compared with a Q2 2011 loss of US$221 million, on revenue of US$344 million, down from US$385 million.