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Micron to buy major Apple supplier Elpida, takes on Samsung

U.S.-based Micron could become a major supplier of memory chips to Apple when it completes the purchase of Japan-based Elpida.

Brooke Crothers Former CNET contributor
Brooke Crothers writes about mobile computer systems, including laptops, tablets, smartphones: how they define the computing experience and the hardware that makes them tick. He has served as an editor at large at CNET News and a contributing reporter to The New York Times' Bits and Technology sections. His interest in things small began when living in Tokyo in a very small apartment for a very long time.
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Brooke Crothers
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Micron will become the No. 2 maker of memory chips worldwide, second only to Samsung as it is set to buy Elpida Memory, a big supplier to Apple.

The Boise, Idaho-based chipmaker will purchase bankrupt Elpida for $2.5 billion, instantly doubling its share of the memory chip market to about 24 percent. Market leader Samsung has about a 42 percent share.

Elpida was formed in 1999 when NEC and Hitachi merged their memory chip businesses. But the price volatility of the memory market forced it to file for bankruptcy in February with $5.6 billion of debt, despite having become the world's third-largest maker of memory chips.

The Japanese company has a strong presence in the mobile DRAM market and has been a major supplier of memory to Apple and was a leading DRAM supplier for the third-generation iPad and iPhone 4S.

"We suspect Apple may have influenced Micron's bidding in an effort to avoid disruption to their mobile DRAM supply," Glen Yeung, an analyst at Citigroup, wrote in a research note in May.

Elpida is a big supplier of mobile DRAM to Apple. The third-generation iPad uses Elpida memory.
Elpida is a big supplier of mobile DRAM to Apple. The third-generation iPad uses Elpida memory. Apple