Matsushita Electric Industrial and Renesas Technology have agreed to tie up in developing next generation semiconductors, the Nikkan Kogyo newspaper reported on Thursday.

According to the newspaper, Renesas, a joint venture between Hitachi Ltd and Mitsubishi Electric Corp and Matsushita would also embark on joint production of the 32-nanometer chips.

Rival Japanese chip makers Toshiba and NEC Electronics Corp. said in November they would jointly develop 32-nanometer chips.

Samsung Electronics Co., IBM, Chartered Semiconductor Manufacturing Ltd., Infineon Technologies, STMicroelectronics and Freescale Semiconductor have said they would work through 2010 to develop and produce 32-nanometer chips.