Intel Corporation (NASDAQ: INTC) and SK hynix have announced signing of an agreement where SK hynix will acquire Intel’s NAND memory and storage business for USD 9 Billion. The transaction will include the NAND SSD business, Dalian NAND memory manufacturing facility in China and the NAND component and wafer business. Intel will retain its Intel Optane business.
Both companies will have to obtain governmental approvals where applicable which is expected late 2021. Intel will continue to manufacture NAND wafers at the Dalian Memory Manufacturing Facility and retain all IP related to the manufacture and design of NAND flash wafers until final closing of the deal. SK hynix is focused on enhancing its storage solutions which includes enterprise SSDs in the growing NAND flash space segment. SK hynix will leverage this transaction to grow the memory ecosystem to benefit its customers, partners, employees and shareholders further.
On the six months ended June 27th, 2020, the company’s NAND businesses contributed USD 2.8 Billion of revenue for Intel’s Non-volatile Memory Solutions Group and contributed USD 600 Million to NSG operating income. Intel plans to utilize the proceeds from the transaction to deliver leadership products and fuel its long term growth which include 5G networking, intelligent autonomous edge and artificial intelligence segments.
“I am pleased to see SK hynix and Intel’s NAND division, which have led the NAND flash technology innovation, work to build the new future together,” said Seok-Hee Lee, chief executive officer (CEO) of SK hynix. “By taking each other’s strengths and technologies, SK hynix will proactively respond to various needs from customers and optimize our business structure, expanding our innovative portfolio in the NAND flash market segment, which will be comparable with what we achieved in DRAM.”
Bob Swan, Intel CEO said: “I am proud of the NAND memory business we have built and believe this combination with SK hynix will grow the memory ecosystem for the benefit of customers, partners and employees. For Intel, this transaction will allow us to further prioritize our investments in differentiated technology where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders.”