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Intel Corp is preparing to sell its NAND memory chip business to SK Hynix Inc for nearly $ 10 billion in a deal that would propel the South Korean chipmaker to second place in the world rankings, two sources familiar with the matter said.
The deal would allow SK Hynix to overtake Japan’s Kioxia as the No. 2 player in the NAND memory market and bridge the gap with market leader Samsung Electronics Co Ltd as the shift to work from home increases demand for used chips. on tablets and servers.
Intel would sell its solid-state drive business in the United States and its factory in Dalian, China, which produces advanced flash memory, known as 3D NAND, sources told Reuters on Monday. The company would keep XPoint, its advanced memory technology unit, they said.
The deal would allow Intel to focus on its remaining memory business, Optane, one of the sources said. The person said the deal could be announced Monday in the United States or Tuesday in South Korea, although a final decision has not been made.
Another person said the deal would be a cash transaction.
Intel did not immediately respond to Reuters requests for comment, while SK Hynix declined to comment.
DEMAND DRIVEN BY PANDEMIC
The Nand Flash industry grew in the April-June quarter thanks to strong demand for PCs and servers, as the COVID-19 pandemic forced millions of people to work from home, according to market researcher Trendforce.
Hynix, which counts Apple and Huawei as customers, ranks a distant fourth in the market for NAND memory chips, although it ranks second after Samsung Electronics in DRAM memory sales.
Samsung is the leader in the NAND flash market with a 31.4% share, followed by Kioxia with 17.2%, SK Hynix with 11.7% and Intel and Micron with 11.5% each.
With the acquisition, SK Hynix, part of South Korean conglomerate SK Group, would have a 23.2% market share, narrowing the gap with the city’s rival Samsung Electronics.
The Wall Street Journal previously reported that the deal could be announced in the United States on Monday. Intel shares rose nearly 3% after the report.
– reuters
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