Tuesday, March 25, 2008
Negotiations between major shareholders Qimonda AG and Nanya Technology Corp on the future of their DRAM manufacturing JV Inotera Memories Inc. have stirred rumors in the industry. Nanya could take over Qimonda's 35 percent stake, a Bloomberg report said. Qimonda however seems to have different plans.
A Qimonda spokesperson acknowledged that the company presently is in negotiations with its technology and manufacturing partner Nanya over Inotera's future. He however pointed out that there is no decision in sight. "Any option is equally likely", he said, refusing any further comment.
Nanya and Qimonda each hold 35 percent of the Inotera shares; the remainder is owned by the Inotera staff and in the free float. Inotera's production is shared equally between Qimonda and Inotera. According to sources close to the matter, Inotera contributes about 25 to 30 percent to Qimonda's total production of about 180.000 wafer starts per month (WSPM).
Qimonda's move to change its production to 58nm geometries and to introduce a new production technology based on the company's Buried World Line technology coincides with the end of the company's technology cooperation with Nanya. "We think we are in a very strong position with respect to our technology," said a Qimonda source with regard to the ongoing negotiations. "This technology enables us to play an active role in the market. We have no interest to sell our Inotera stake."
The Bloomberg article quotes Nanya Senior Vice President Moor Chen saying that there are several options, of which the takeover of Qimonda's Inotera stake is just one possibility. Another option would be that Qimonda instead buys Nanya's stake, or that both companies sell all or part of their stakes to a third-party investor.
According to Bloomberg, the discussions between Nanya and Qimonda began after US DRAM manufacturer Micron Technology agreed to form a joint venture with Nanya. This venture will producing chips using Micron's 'stack' manufacturing technology while Inotera uses Qimonda's 'trench' technology.
Despite high losses in the recent quarters, Qimonda might not be forced to move out of the manufacturing joint venture. The Qimonda source pointed out that the company has a comfortable cash position and achieved a strong bit growth. "Our growth is more than healthy," the person said. "We do not sit on piles of unsold memory chips."
Qimonda parent company Infineon's stock prices added 7.5 percent on the news. The company however was not available to comment. Interestingly, Qimonda's shares at the Berlin stock exchange performed weak, slipping 2,6 percent. In recent weeks, Infineon has come under heavy pressure due to the losses of its Qimonda subsidiary.
By: DocMemory
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