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TOKYO (Reuters)—Toshiba Corp said on Tuesday it would join a group led by International Business Machines Corp to develop system chips using 32-nanometer circuitry, as chip makers increasingly team up to cut development costs.

The alliance also comprises Advanced Micro Devices, Samsung Electronics, Singapore’s Chartered Semiconductor Manufacturing, Germany’s Infineon Technologies AG and privately owned U.S.-based Freescale Semiconductor Inc.

Toshiba previously signed an agreement with domestic peer NEC Electronics Corp to jointly work on 32-nanometer technology. That alliance would focus on ways to mass-produce the chips, Toshiba said.

The seven companies have agreed to work through 2010 to design, develop and produce chips using tiny circuitry.

Using smaller circuit sizes helps boost chip makers’ productivity by making smaller chips more powerful, but the move to smaller sizes is becoming too difficult and expensive for a single manufacturer to undergo alone.

(Reporting by Mayumi Negishi; Editing by Mike Miller)