SK Hynix decided to acquire Intel’s NAND memory business.
Through an official announcement, SK Hynix stated that it entered a deal with Intel to acquire most of Intel’s NAND memory business for $9.04 billion (10.3104 trillion KRW).
SK Hynix explained that it would acquire the entirety of Intel’s NAND memory business excluding Intel’s Optane business and that the entire acquisition process will take place in the form of two payments.
First, intellectual properties (IP) and personnel related to Intel’s Dalian fab and SSD (Solid State Drive) will be transferred to SK Hynix’s subsidiary that is set to be established in a foreign country by the end of 2021.
Second stage will involve acquisition of IPs related to NAND flash memory, R&D employees, and the remainder of workforce from the Dalian fab through SK Hynix’s subsidiary.
SK Hynix’s decision to acquire Intel’s NAND memory business comes from its plan to expand its NAND flash memory business. According to IHS Markit, Samsung Electronics was unrivaled in the global NAND flash memory market last year as it had a 35.9% market share. After Samsung Electronics, it was Kioxia (19%), Western Digital (13.8%), Micron (11.1%), SK Hynix (9.9%), and Intel (9.5%). Once Intel completes acquiring Intel’s NAND memory business, it will become the world’s second biggest flash memory manufacturer. SK Hynix will also be able to create a great level of synergy as Intel has shown strengthen in the global industrial SSD market. Also, Intel possesses one of the best NAND SSD technologies in the industry and QLC (Quadruple Level Cell) NAND flash products.
SK Hynix’s weakness has been its NAND flash memory business. It has been recording losses due to fierce competitions. However, its plan is to become a leader in the industry by continuing to strengthen its competitive edge in multi-level NAND flash products and doubling its competitive edge by acquiring Intel’s NAND memory business.
“With its acquisition, we are going to strengthen our competitive edge in the NAND flash field that is growing at a rapid rate due to the arrival of a big data era even more and become a global leader in the industry.” said SK Hynix.
Intel decided to sell its NAND flash memory business in order to restructure its business so that it is centered on non-memory semiconductors. Its decision also comes from fierce competitions within the global NAND flash memory market and a recent setback to its CPU business and a rapid pursuit by AMD.
“We are extremely pleased that NAND memory businesses of SK Hynix and Intel that have been leading innovations of NAND flash technology are now joined together in order to create a new future.” said President Lee Seok-hee of SK Hynix. “We will actively respond to various requests from customers by utilizing strengths from each business and optimize business structure of our NAND memory business by securing competitive edge in the NAND field equivalent to that of our DRAM business.”
Staff Reporter Yun, Geonil | email@example.com