SEOUL -- Another roadblock has emerged in Micron Technology Inc.'s proposed $3.4 billion deal to acquire Hynix Semiconductor Inc.'s memory chip business.
The Federation of Korean Trade Unions (FKTU), the largest labor group in South Korea, will go on strike to support Hynix's own union, which plans to protest against the proposed Hynix-Micron alliance, according to reports from the Dow Jones news wire.
The threat of semiconductor strikes is a familiar situation in Korea, where union workers at LG Semicon attempted to block the creation of Hynix when their company was merged into Hyundai Electronics three years ago. In February 1999, LG workers staged a 15-day walkout to protest the sale, but returned to work after the company agreed to pay a six-month wage bonus in return for the union to accept the merger with Hyundia.
Under a non-binding memorandum of understanding (MOU) announced on Monday, U.S.-based Micron said it would buy Hynix's memory chip business for 108.6 million shares of stock, valued at over $3 billion, and a $200 million investment(see April 22 story). The deal would turn Micron into the world's largest DRAM maker, moving ahead of South Korea's Samsung Electronics Co. Ltd., according to analysts.
Following the announcement, the union representing South Korea's Hynix said it may call a strike to protest against the proposed agreement with Micron.
Now, the FKTU is getting into the act. "We will do everything to stop Hynix's board of directors and creditors in approving the sale plan, regardless of the strong opposition from civil organizations and shareholders," FKTU spokesman Lee Sang-yeon told Dow Jones.
Hynix's labor union comes under auspices of the FKTU, which claims 956,342 members from 3,374 union groups, the report said. About 7,500 of Hynix's 13,000 employees are union members, it added.
