SK Hynix Withdraws from Elpida Memory Auction

From X-bit Labs: SK Hynix has reportedly decided to pull out from the incoming auction for insolvent Elpida Memory, leaving only two potential buyers for the troubled maker of dynamic random access memory: Micron Technology and a group of private equity funds.

The acquisition of Elpida Memory and its assets, including technologies and a DRAM plant in Hiroshima, Japan, would not "strategically benefit" the company, SK Group's chairman Chey Tae-won told reporters after a board meeting without elaborating, Reuters news-agency reports. Previously SK Hynix indicated that the company was investigating Elpida's financial reports.

As a result, at present there are two potential bidders for the bankrupt maker of memory: Micron Technology, which negotiated about a merge with Elpida early this year, and joint bid by Hiny Capital and Hony Capital.

Elpida filed for bankruptcy protection in late February amid ¥448 billion ($5.5829 billion) in liabilities. A group of Elpida bondholders said last month they may thwart the auction if trustees agree to a reported selling price of ¥150 billion ($1.8692 billion). Even this price is very high as few makers of commodity chips have that much money in bank.

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