Micron to buy $400 million stake in memory maker
Micron will buy Qimonda's 35.6 percent stake in Inotera Memories.
Micron Technology announced Sunday that it is buying Qimonda AG's $400 million stake in Inotera Memories.
Inotera was founded as a joint venture by Qimonda (formerly the memory products division of Infineon Technologies) and Nanya Technology. Micron said the deal constitutes an expansion of its relationship with Nanya.
In the current Qimonda-Nanya partnership, Inotera operates two 300-millimeter wafer fabrication facilities producing a total of 120,000 wafers per month, Micron said.
Under the agreement, Micron will acquire access to half of the manufacturing capacity of Inotera, with the other half allocated to Nanya. Micron said it will also share its Stack DRAM technology with Inotera for the production of Stack DRAM products for Micron and Nanya.
The stake in Inotera will improve the Boise, Idaho memory chipmaker's economies of scale. "Micron will gain greater scale in DRAM, reduce our operating expenses per wafer and have access to a very cost competitive operation," Micron Chairman and CEO Steve Appleton said in a statement.
The transaction will be completed in two stages, with Micron purchasing half of Qimonda's stake, or about 18 percent of Inotera, for $200 million in cash within approximately the next week--subject to certain government approvals and other customary conditions. The remaining 18 percent stake in Inotera will be acquired upon receipt of Taiwan Federal Trade Commission approval and other customary conditions, Micron said.
Following the acquisition, Qimonda's share of Inotera's capacity will be ramped down over a period of months, according to Micron.
Micron expects to restructure the previously-announced MeiYa joint venture with Nanya. "It is anticipated that both parties will cease future resource commitments to MeiYa and redirect those resources to Inotera," Micron said.
To help fund the purchase price, Micron has obtained $285 million in term loan financing commitments from strategic sources at favorable terms.
This agreement followsby approximately 15 percent during the next two years as it scales back flash memory chip production in Boise, Idaho.