Samsung Electronics Co, the world's top memory chip maker, said on Friday it was in contract chip manufacturing deal with its Japanese rival Toshiba Corp for production of non-memory chips.

Toshiba said earlier on Friday it would increase outsourcing of non-memory chips to foundries and that Samsung was one of its options for chip outsourcing.

We have agreed with Toshiba to produce low-power processing chips with advanced 40 nano processing technology, Samsung spokesman James Chung said.

(Reporting by Miyoung Kim; Editing by Yoo Choonsik)