SK Hynix Expands NAND Business... Established 12 Corporations Including US and UK in First Half of the Year

[Image source=Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] SK Hynix, which is in the process of acquiring Intel's NAND flash business unit, has established 12 related subsidiaries worldwide, including in the United States, in the first half of this year, signaling a full-scale expansion of its NAND business.

According to industry sources on the 18th, SK Hynix established 12 NAND-related subsidiaries globally between March and June. These newly established corporations were set up in 10 countries, starting with Delaware in the United States, followed by Canada, Mexico, the United Kingdom, Israel, China, Taiwan, Japan, Singapore, and Malaysia. Most of these subsidiaries will be responsible for semiconductor sales and sales support, while the Israeli subsidiary will handle semiconductor manufacturing, and the subsidiaries in Mexico, China, the UK, and Singapore will also be in charge of semiconductor research and development.

The fact that SK Hynix established more than 10 new subsidiaries in the first half of this year is interpreted as preparatory work to fully expand its NAND business after the acquisition process of Intel's NAND business unit, which began in October last year, entered its final stages. Currently, SK Hynix has received approval from seven of the eight countries under review for the Intel NAND business acquisition (the United States, EU, South Korea, Taiwan, Brazil, the UK, and Singapore) and is only awaiting China's approval. In its Q2 earnings conference call at the end of last month, SK Hynix projected that the acquisition process would be completed within the year upon receiving approval from China's antitrust authorities.

Once SK Hynix obtains China's approval, it plans to expand its NAND business based on the newly established company headquartered in the United States. On the 5th, Robert Crooke, Intel's Vice President, announced via his social media that "once the review is complete, a new company headquartered in the United States will be established," and he will serve as the CEO of that company. He also added that many Intel executives will join SK Hynix's new subsidiaries. The market expects SK Hynix to recruit the person who previously oversaw Intel's NAND business and retain existing customers to continue the business. SK Hynix has already begun hiring in the United States, Taiwan, and China, planning to recruit more than 150 personnel, including logistics and HR staff.

Upon completion of China's review process, SK Hynix will initially pay Intel $7 billion (approximately 8 trillion KRW), and Intel will transfer its NAND solid-state drive (SSD) business (including SSD-related IP and personnel) and assets of the Dalian factory in China to SK Hynix. Then, in March 2025, SK Hynix will pay the remaining $2 billion and receive Intel's NAND wafer design and production-related IP, R&D personnel, and Dalian factory operational staff, along with the remaining assets. These new subsidiaries are expected to play a role in expanding business capabilities in each country throughout this process.

Currently, SK Hynix's NAND business ranks fifth globally, but upon completing the acquisition of Intel's NAND business unit, it is expected to rise to second place. SK Hynix is diversifying its business structure, which had been heavily concentrated on DRAM, through the expansion of its NAND business.

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