Micron to Acquire Elpida for US$2.5 Billion, Purchase Rexchip's Shares from Powerchip
July 06, 2012
Micron and Elpida announced on July 2, 2012 that the two companies have inked a definitive sponsor agreement and Micron will acquire and support Elpida, according to a press release by Elpida. As per the agreement, Micron will acquire Elpida for 200 billion yen (US$2.50 billion; US$1=79.9 yen). It is reported that Micron will acquire 100% of Elpida's equity for 60 billion yen (US$750.9 million) and pay 140 billion yen (US$1.75 billion) in annual installment payments, which will end in 2019.
Meanwhile, Micron also announced a separate agreement with Taiwanese Powerchip to acquire the compnay's 24% share of Rexchip for NT$10 billion (US$334.4 million; US$1=NT$29.9), according to the same source. Combining the shares to be acquired from Powerchip, Micron is projected to own around 89% of Rexchip's outstanding shares. It is reported that new capacity gained from Elpida and Rexchip will boost Micron's overall capacity by approximately 50%. It is expected that Elpida's reorganization plan will be submitted to the Tokyo District Court for approval in August 2012. The Elpida transaction is anticipated to close in the first half of 2013. Micron's purchase of Rexchip shares will take place upon close of the Elpida transaction.