BOISE, Idaho--After months of negotiations, Micron Technology Inc. today announced a non-binding agreement to purchase the memory business of Hynix Semiconductor Inc. for 108.6 million shares of stock, valued at about $3.2 billion. Micron said it has also agreed to invest $200 million in Hynix in return for a 15% equity stake in the Korean company's non-memory chip business.
If the acquisition is completed, it would combine the world's second and third largest DRAM makers in the world, pushing Micron ahead of Samsung Electronics Co. Ltd. in the $11 billion market for dynamic random access memories. It could also help Hynix, which is being crushed with more than $6 billion in debt.
As part of the transaction, Korean lenders will provide $1.5 billion of long-term debt financing to Micron for use in its Korea-based operations once the acquisition is completed, according to the two companies today.
"Although there remain additional details to be negotiated before a definitive agreement can be achieved, we're confident the outstanding resources of Hynix combined with Micron's operations will create a leading semiconductor company that will benefit its employees, shareholders, affiliates and worldwide customers," said Steve Appleton, president and CEO of Boise-based Micron.
The preliminary purchase agreement is subject to approval by the Hynix's creditors council and the boards of directors of both companies by April 30, Micron said.
Assuming the deal is backed by the boards of directors, the transaction must also be approved by U.S. and European antitrust authorities as well as Hynix shareholders.
