[CES2022] "10 Trillion Intel NAND Acquisition, Appropriate Level... Confidence in Capability"

Lee Seok-hee, President of SK Hynix, Reiterates
"Memory Demand Remains Strong This Year"

Lee Seok-hee, President of SK Hynix, is speaking at a press conference in Las Vegas, USA, where CES 2022 was held.
[Photo by SK Telecom]

[Asia Economy Reporter Kim Heung-soon] "The answer regarding the acquisition price remains the same. It is by no means expensive."

On the 8th (local time), Lee Seok-hee, CEO of SK Hynix, made this assessment at a press conference for Korean reporters held at CES 2022, the world's largest electronics and IT exhibition in Las Vegas, USA, regarding the acquisition amount for Intel's NAND flash business. This reiterated his earlier stance from 2020, when the acquisition process was underway, countering criticisms that Intel's NAND market share was low and that the NAND factory in Dalian, China, was outdated.

He emphasized, "When questions focused on the fab (manufacturing plant), I said we needed to look at the engineering in the U.S. I was confident in the capabilities of the 1,500 engineers at Intel," he said emphatically. No Jong-won, President of SK Hynix's Business Division, also added, "Although there was a significant price gap initially, considering the value this company can create in the future, the price is quite reasonable," and said, "We will prove this through our business going forward."

SK Hynix completed the first phase of acquiring Intel's NAND business on the 30th of last month. After receiving China's antitrust approval, they finalized the necessary work to acquire the assets owned by Intel. The contract amount totals $9 billion (approximately 10.8 trillion KRW), of which $7 billion will be paid to Intel in the first phase. Then, around March 2025, the remaining $2 billion will be paid in the second phase, and the NAND flash memory-based data storage device SSD business and the Dalian fab in China will be transferred from Intel.

SK Hynix named the newly established U.S. subsidiary that will operate Intel's SSD business "Solidigm." Headquartered in San Jose, California, Solidigm will take over the SSD business previously operated by Intel, overseeing product development, production, and sales. The CEO stated, "By switching to Solidigm's SSDs, carbon emissions can be reduced by 93%," emphasizing, "This is a great opportunity not only to create enterprise value (EV) but also to significantly contribute to solving environmental issues."

President No explained, "SK Hynix's NAND business has so far been focused on mobile products, while Intel's technology is for SSDs and enterprise use. This acquisition was aimed at creating synergy." He also addressed the conditions imposed by the Chinese government when approving the acquisition of Intel's NAND business, which included limiting prices supplied to Chinese customers and providing stable product supply and related technologies, saying, "These are general conditions at an acceptable level," cautioning against overinterpretation.

Meanwhile, both the CEO and President No forecast the memory market outlook for this year as, "Although there is high volatility due to global supply chain issues, overall demand remains solid and is expected to be better than last year."

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