The SK Hynix acquisition of Intel’s NAND storage and memory business is progressing through regulatory approval. Though the $9 billion acquisition has received the go-ahead by the US Committee of Foreign Investment and Federal Trade Commission, it is now pending review by EU antitrust enforcers. The EU decision deadline is set for May 20.
Through the acquisition, SK Hynix will become the second largest NAND producer after Samsung, which currently holds 32.9% of the market. In Q4 2020, SK Hynix’s NAND market share was 11.6%, and Intel’s accounted for 8.6%. The company plans to more than triple its flash memory revenue over the next five years with the acquisition, which will boost its market share of flash memory components used in computers and other devices.
Memory modules of all capacities are, currently, experiencing shortages, and SK Hynix is optimistic the expansion of its portfolio in the NAND market segment will meet demand.
Intel says it will continue to supply its SSD products to the market, as well as relevant technical support and software upgrading services to customers. The company is not giving up the storage business but simply outsourcing its manufacturing and plans to use acquisition proceeds to re-direct resource focus on differentiated technology (i.e., artificial intelligence, 5G networking and the intelligent, autonomous edge).
SK Hynix and Intel first announced the acquisition in October 2019. Intel will transition its NAND business to SK Hynix over a five-year period in order to make a smooth adoption for customers, suppliers, employees, partners and shareholders. Following the regulatory approvals for the transaction, SK Hynix will pay Intel $7 billion and the remaining $2 billion at the final closing in 2025.
