Link to Owner Dr. Robert B. Pamplin Jr.



Intel to sell its memory chip business to South Korea's SK Hynix, push on into artificial intelligence, 5G networking and the intelligent, autonomous edge.

COURTESY: INTEL CORP - Intel is retaining its next-generation memory technology called Optane (pictured here) while selling its memory chip business to SK hynix.

South Korean firm SK Hynix is buying Intel's NAND memory and storage business for one $7 billion payment and a $2 billion payment.

The $9 billion sale consists of the chip giant's solid-state drive (SSD) business, NAND IP, and wafer production. Intel is selling its Dalian fab in China but will still manufacture NAND wafers there. Much of the relevant workforce is in California, not Oregon.

The transaction is subject to regulatory review, and it is business as usual until the transaction closes, which is expected in late 2021. The second payment will be in March 2025.

Intel is known for its microprocessors but has long had a flash SSD business. However, the flash memory business is capital-intensive, suffers pricing volatility, and is low margin.

The deal gives SK Hynix Intel's R&D employees and the remainder of the Dalian workforce. At that point, Intel will stop manufacturing wafers at the Dalian plant.

Intel will, however, retain its Optane memory business and intellectual property. Intel shares the 3D XPoint IP with Micron, although Micron makes those memory chips. The deal will give SK Hynix 19.1% of the market unit share, behind its South Korean rival Samsung which has 24.6%

Intel CEO Bob Swan said in a release, "For Intel, this transaction will allow us to further prioritize our investments in differentiated technology where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders."

Intel said it "intends to invest transaction proceeds to deliver leadership products and advance its long-term growth priorities, including artificial intelligence, 5G networking and the intelligent, autonomous edge."

"I am pleased to see SK Hynix and Intel's NAND division, which have led the NAND flash technology innovation, work to build the new future together," said Seok-Hee Lee, chief executive officer (CEO) of SK Hynix. "By taking each other's strengths and technologies, SK Hynix will proactively respond to various needs from customers and optimize our business structure, expanding our innovative portfolio in the NAND flash market segment, which will be comparable with what we achieved in DRAM."

SK Hynix makes dynamic random access memory chips ("DRAM"), flash memory chips ("NAND flash") and CMOS image sensors ("CIS") for a wide range of customers globally. SK Hynix's shares are traded on the Korea Exchange, and the Global Depository shares are listed on the Luxembourg Stock Exchange.

You count on us to stay informed and we depend on you to fund our efforts. Quality local journalism takes time and money. Please support us to protect the future of community journalism.

Go to top
JSN Time 2 is designed by | powered by JSN Sun Framework