'$9 Billion Big Deal: SK Hynix Acquires Intel's NAND Memory Business in the US (Comprehensive)'

[Asia Economy Reporter Kim Hyewon] SK Hynix is acquiring Intel's NAND flash memory and storage business in the United States for 10.3 trillion KRW. This is the largest acquisition and merger (M&A) in South Korea's history. Upon successful completion of this deal, SK Hynix will rise to become the world's second-largest company in the NAND sector, following its leading position in DRAM among memory semiconductors.

On the 20th, SK Hynix announced through a public disclosure that it had signed a transfer and acquisition agreement to purchase Intel's NAND business division for $9 billion (approximately 10.3104 trillion KRW). This amount surpasses Samsung Electronics' acquisition of Harman in 2016 ($8 billion), marking the largest M&A deal in South Korea to date.

The acquisition targets include Intel's NAND solid-state drives (SSD), NAND standalone products and wafer business, and the Dalian production facility in China. The next-generation memory sector, Intel's Optane business, is excluded from this deal.

SK Hynix's strategy with this acquisition is to strengthen its competitiveness in solutions such as enterprise SSDs in the rapidly growing NAND flash sector amid the big data era, aiming to become a global leading company. Currently, SK Hynix ranks second in the DRAM sector after Samsung but is around fifth globally in NAND. With the acquisition of Intel's NAND business, SK Hynix will leap to the global second position.

SK Hynix has demonstrated technological prowess by being the first in the world to develop CTF (Charge Trap Flash)-based 96-layer 4D NAND (2018) and 128-layer 4D NAND (2019) flash memory. Going forward, SK Hynix plans to integrate Intel's solution technology and production capabilities to build a high value-added 3D NAND solution portfolio focused on enterprise SSDs.

[Image source=Yonhap News]

Intel plans to use the funds obtained from this transaction to invest primarily in areas requiring long-term growth, such as product competitiveness enhancement, artificial intelligence (AI), 5G communication networking, intelligent edge, and autonomous driving technologies.

As a global semiconductor leader, Intel possesses top-tier NAND SSD technology and QLC (Quadruple Level Cell) NAND flash products. Intel's NAND business, part of its memory division NSG, recorded sales of approximately $2.8 billion and operating profit of about $600 million in the first half of this year.

SK Hynix and Intel plan to cooperate to ensure the smooth completion of this contract for customers, partners, and employees. Furthermore, both companies will continue to collaborate to meet the growing demand in the memory-based semiconductor ecosystem, as seen in recent DDR5 cooperation.

Lee Seok-hee, CEO of SK Hynix, said, "We are very pleased that SK Hynix, which has led innovation in NAND flash technology, and Intel's NAND business division can create a new future together." He added, "By leveraging each other's strengths, SK Hynix will actively respond to diverse customer needs, secure competitiveness in the NAND sector comparable to DRAM, and optimize its business structure."

Bob Swan, CEO of Intel, stated, "We are proud of the NAND memory business Intel has built." He added, "Through this combination with SK Hynix, we can grow the memory ecosystem and provide benefits to customers, partners, and employees." Regarding future plans, he said, "We will prioritize investment in differentiated technologies that only Intel can offer to deliver greater value to customers and shareholders."

This content was produced with the assistance of AI translation services.