SK hynix Inc. the world's second-largest memory chipmaker said Friday that it
submitted a letter of intent to buy bankrupt Elpida Memory Inc. as part of its
effort to become the top industry player.
The company, formerly Hynix
Semiconductor Inc., said in a regulatory filing that it forwarded an initial
offer earlier in the day to meet the bidding deadline.
"A final
decision on whether to make a formal bid will be made after the due diligence of
the Japanese chipmaker is carried out," it said.
The move comes after
the South Korean chipmaker was incorporated into SK Group, South Korea's third
largest conglomerate on Monday. Elpida filed for bankruptcy protection on Feb.
27 after it continued to loose money in the face of weak global demand and stiff
competition.
Local industry watchers said that because SK Group is
flush with cash from earnings generated by its flagship SK Telecom, the
country's largest mobile operator, it has a fair chance of buying the
company.
They speculated the conglomerate could pool at least 1.5
trillion won (US$1.32 billion) in cash for the bidding. SK hynix is expected to
invest around 4 trillion won this year to improve its facilities and overall
competitiveness.
"If SK hynix becomes the new owner of Elpida, it
would have a global market share exceeding 30 percent that could challenge the
position of Samsung Electronics Co., the world's largest memory chipmaker," an
analyst said.
At present, Samsung hold 44 percent of the world's
memory chip market, with SK hynix trailing at 23 percent.
Besides SK
hynix, U.S.-based Micron Technology Inc. and Japan's Toshiba Corp., are taking
part in the bidding process that may conclude in May.
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