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Micron, Elpida negotiations still underway

Posted: 14 Feb 2012 ?? ?Print Version ?Bookmark and Share

Keywords:memory market? DRAM prices?

Although Micron Technology Inc. did not address the rumors circulating that it is in talks with Elpida Memory Inc., one Wall Street analyst believes that the two companies remain in negotiations.

"We believe Micron continues to be in negotiations, with the most likely outcome being asset purchase," said C.J. Muse, an analyst at Barclays Capital, in a report. Barring intervention from the Japanese government, DRAM industry consolidation involving Elpida is all but inevitable, and likely a positive for Micron, Muse wrote.

Elpida, which has been losing money hand over fist as DRAM prices have sunk, is mired in debt and has a debt payment of more than $1 billion due in April. The company earlier this year was reportedly scouring for strategic investment by customers to help it meet its obligations. Rumors of a possible deal with Micron have been circulating for weeks.

Muse said investors were likely to walk away from Micron's analyst day encouraged following presentations by new CEO Mark Durcan and new President Mark Adams. Both were promoted late last week following the death of longtime CEO Steve Appleton. Muse said Micron's swift transition to new management boded well for the company.

- Dylan McGrath
??EE Times

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