A July 13 Wall Street Journal article disclosed that China’s state-owned Tsinghua Unigroup has bid to buy Micron Technology for $21 a share or $23 billion, which would make this the largest-ever Chinese takeover of a U.S. company.
Objective Analysis has been telling our clients for the past few years that either China or India would create a new DRAM/NAND manufacturing company, especially since memory chip makers have enjoyed a long period of profits, and this usually motivates outsiders to invest in new DRAM makers. We did not anticipate an acquisition.
Countries with heavy industry typically move into the semiconductor business during an extended upturn, and become DRAM suppliers since DRAM is an undifferentiated commodity. Commodities sell almost solely on price and success is based on little more than manufacturing strength. This is a business model that industrial economies understand.
In addition to Micron’s tangible assets, including Continue reading
During SK hynix’ October 29 earnings call the company further clarified the status of its Wuxi fab line that was hit by a fire on September 4. In brief, the company may miss its expected end-November date to recover to full operation.
Interestingly, although DRAM bit shipments declined by 2% because of the fire, revenues increased by 3% thanks to price increases caused by the resulting tight DRAM supply. This gave the company a revenue boost taking total semiconductor revenues from ₩3.93 trillion ($3.54B US) in the second quarter to ₩4.08 trillion ($3.66B US) in the third quarter. Not only was this revenue a record number for SK hynix, but margins also reached a record high.
All in all, it was a very good quarter, despite the fire, and perhaps because of it.
The company disclosed that restoration of the air ventilation system and the clean room have been Continue reading
We would like to provide the following update on the recovery status of SK Hynix Wuxi fab that was affected by the fire on Wednesday September 4, 2013. The air ventilation system and cleanroom in the line that was affected by the fire have now been substantially restored, and we have resumed partial utilization in this line from Thursday October 10, 2013. We will gradually raise utilization and make every effort to recover normalized level of pre-fire utilization in November as planned.
This statement should put to rest Continue reading