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Monday, 26 March 2012 11:29

Micron likely to buy Elpida

Written by Nick Farrell



Could spend $1.5 billion


The Dark Satanic rumour mill has suggested that Micron will be the winning bidder to purchase struggling chip maker Elpida.

Toshiba and Globalfoundries have all taken part in the bidding but it looks like Micron will win with a bid which is netween $1.3 billion and $1.5 billion. Elpida's main asset is its Hiroshima plant which is estimated to be worth about $1 billion.  It would mean that Micron would not have to built a new fab to expand.

Micron has $2.1 billion available in cash and short term investments.  Recently appointed chief executive officer Mark Durcan said that the company expects DRAM prices to recover, but explained that even if the company has been able to sell more NAND Flash and DRAM in the last quarter, the greater volume was offset by lower average selling prices.

Increased manufacturing capacity and cost improvements could be one way for Micron to protect itself in the future from downturns in the market. Micron recently made a similar move when it acquired Intel's shares in the flash memory joint-venture IM Flash.

Nick Farrell

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