Micron Technology Plunks Down $2.5B for Elpida
July 3, 2012 9:35 AM
comment(s) - last by
Deal is expected to close next year
Micron and Elpida have announced they have signed a sponsor agreement that will see the former acquire the latter. The agreement has been entered into in connection with Elpida's corporate reorganization proceedings and are being conducted under the jurisdiction of the Tokyo District Court. The complete value of the deal is $2.5 billion minus some reorganization proceeding expenses.
Some of those expenses will be used to pay reorganization claims of secured and unsecured creditors of Elpida. For the expenditure, Micron will acquire 100% of Elpida with $750 million of the total purchase price being paid in cash at closing. The additional $1.75 billion will be paid in annual installment payments through 2019. The money for those installment payments will be paid from cash flow generated from Micron's payment for foundry services provided by Elpida as a Micron subsidiary.
"We are creating the industry-leading pure-play memory company," said Micron CEO Mark Durcan. "Today's transactions will help strengthen the combined companies' market position in the memory industry through increased research and development and manufacturing scale; improved access to core memory market segments; and additional wafer capacity to balance among DRAM, NAND and NOR memory solutions for the ultimate benefit of Micron and Elpida customers."
The purchase agreement between the two companies also requires that Micron will provide financing support for Elpida capital expenditures under certain conditions and to maintain operations and employees of the company. Assets that Elpida holds that Micron is gaining include a 300 mm DRAM production facility in Hiroshima, Japan and 65% ownership interest in a company called Rexchip. Rexchip also has a 300 mm DRAM fabrication facility in Taiwan. Micron already owns a stake in Rexchip and the purchase will give it 89% of Rexchip overall.
reports that Elpida has been seeking to reorganize after years of chip prices plummeting and an oversupply on the market. The deal is expected to close in the first half of 2013.
This article is over a month old, voting and posting comments is disabled
7/3/2012 9:58:49 AM
Micron bought a 24% share of Rexchip from PowerChip Technology yesterday.
"There is a single light of science, and to brighten it anywhere is to brighten it everywhere." -- Isaac Asimov
"Prepare to be Punished": Microsoft is Killing OneDrive With Cuts, Blames Users
November 3, 2015, 8:23 PM
Apple's New "Magic" Peripheral Line Packs High Tech, High Prices
October 13, 2015, 9:39 PM
Samsung Adds 2 TB 850 EVO, PRO SSDs for $800, $1000
July 7, 2015, 4:23 PM
Seagate Senior Researcher: Heat Can Kill Data on Stored SSDs
May 13, 2015, 2:49 PM
How to Recover Most Apps After Your NVIDIA Driver Crashes in Windows 10
March 30, 2015, 12:54 PM
Tinkerer Gets Old School Mac Plus Running on the Modern Web
March 24, 2015, 6:41 PM
Most Popular Articles
Top 5 Smart Watches
July 21, 2016, 11:48 PM
Free Windows 10 offer ends July 29th, 2016: 10 Reasons to Upgrade Immediately
July 22, 2016, 9:19 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information