Micron-Hynix Sales Deal Faces Hurdles
First, here's the optimistic scenario: Micron, the No. 2 memory maker, buys the memory operations of No. 3 Hynix, moving the combined company past market leader Samsung Electronics Co., also of South Korea. Micron gets to consolidate excess manufacturing capacity in the glutted market, giving i...
Saved in:
Published in | The Wall Street journal. Eastern edition |
---|---|
Main Author | |
Format | Newspaper Article |
Language | English |
Published |
New York, N.Y
Dow Jones & Company Inc
10.01.2002
|
Edition | Eastern edition |
Subjects | |
Online Access | Get full text |
Cover
Loading…
Summary: | First, here's the optimistic scenario: Micron, the No. 2 memory maker, buys the memory operations of No. 3 Hynix, moving the combined company past market leader Samsung Electronics Co., also of South Korea. Micron gets to consolidate excess manufacturing capacity in the glutted market, giving it greater control over chip prices that are key to the volatile industry's fortunes. what would Micron do with Hynix's manufacturing assets? Mothballing at least some production lines might help bolster chip prices, but a union representing Hynix workers has vowed to make trouble if its members' jobs are threatened. Alternatively, to keep those plants running for the long term, Micron would need to spend heavily on new equipment, said Fred Ramberg, who heads research at Fector Detwiler & Co., a Boston investment banking firm that tracks the memory market. some other observers think the chip speculators simply have been buying among themselves, hoping that a Micron-Hynix deal will make memory still more valuable. It is that kind of thinking that has helped boost Micron's shares more than 20% since talks began; as of 4 p.m. in New York Stock Exchange composite trading, Micron shares were at $35.01. Hynix shares jumped more than 13% yesterday on speculation about a possible deal, last trading at 3,225 won ($2.47). |
---|---|
ISSN: | 0099-9660 |