BOISE, Idaho, and SANTA CLARA, Calif., Nov. 21, 2005 – Micron
Technology, Inc., and Intel Corporation today announced they have
agreed to form a new company to manufacture NAND flash memory for use
in consumer electronics, removable storage and handheld communications
devices. The new company will exclusively manufacture product for
Micron and Intel. Formation of the company is subject to customary
closing conditions and is expected to be finalized around the end of
the year.
The company, to be called IM Flash Technologies, LLC, brings
together the manufacturing technology, assets, experience and scale
necessary for Intel and Micron to successfully compete in the NAND
flash memory business, an increasingly important and fast-growing
market segment. The new company combines Micron’s expertise in
developing NAND technology and operating highly efficient manufacturing
facilities with Intel’s multi-level cell technology and history of
innovation in the flash memory business.
In addition and subject to the closing of the venture, Intel and
Micron have each entered into separate long-term agreements to supply
Apple with a significant portion of each of their share of IM Flash
Technologies’ NAND flash memory output. As part of these agreements,
Apple would prepay $250 million each to Intel and Micron.
“This strategic relationship positions both Intel and Micron to
build on each other’s strengths to become leaders in the fast-growing
NAND market segment,” said Steve Appleton, Micron chairman, president
and CEO. “This enhances Micron’s competitive position as a leading
supplier of advanced semiconductor solutions by ensuring we better
serve our customers in the mobile communication and consumer
electronics market segments.”
“The creation of this new company supports Intel’s intent to
maintain its industry-leading position in nonvolatile memory and
enables us to rapidly enter a fast-growing portion of the flash market
segment,” said Paul Otellini, Intel president and CEO. “We are looking
forward to working with Micron, and are extremely pleased to have Apple
broaden its relationship with us.”
Intel and Micron have agreed to initially contribute approximately
$1.2 billion each in cash, notes and assets to IM Flash Technologies.
Subject to certain conditions, the parties will each contribute an
additional approximately $1.4 billion over the next three years and
intend to make additional investments as appropriate to support the
growth of the operation. The company will be 51 percent owned by Micron
and 49 percent owned by Intel. Production will initially take place in
manufacturing facilities located in Boise, Idaho, Manassas, Va. and
Lehi, Utah. The new company will benefit from Micron’s and Intel’s
process technology expertise to aggressively convert to advanced 72nm
and 50nm technology. Initial production from the company is expected in
early 2006.
The management team for the new company will be led by Intel’s Dave
Baglee, who previously served as manager of Intel’s Fab 11 in New
Mexico, and Micron’s Rod Morgan, who most recently served as manager of
Micron’s fabrication facility in Manassas.
News Source: Intel Press Release
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