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Intel, STMicro Merge Flash Units
Techtree News Staff, May 23, 2007 1708 hrs ISTThe new company will focus on supplying flash memory solutions for a variety of devices, including cell phones, MP3 players, digicams, PCs, hi-tech equipment.
According to reports, Intel and STMicroelectronics have entered into a definitive agreement to create a new independent semiconductor company.
The new company's strategic focus will be on supplying flash memory solutions for a variety of consumer and industrial devices, including cell phones, MP3 players, digital cameras, PCs, and other high-tech equipment.
Reportedly, the new company will combine key research and development, manufacturing, and sales and marketing assets of Intel and STMicro into a streamlined worldwide structure with the scale to produce cost-effective and innovative non-volatile memory solutions.
Carlo Bozotti, President and Chief Executive Officer, STMicro, said that the new company would be positioned to service customers with all of the elements necessary to deliver current and next-generation non-volatile memory technologies, while allowing STMicro to redefine its participation in flash memory.
Adding to it, Paul Otellini, President and Chief Executive Officer, Intel, said that the new memory company would have the people, scale, and technology leadership to meet the needs of customers requiring leading-edge products in this highly competitive marketplace.
Under terms of the deal, STMicro will sell its Nand and Nor flash memory assets to Intel, while Intel will sell its Nor flash memory assets and resources to the former.
In exchange, Intel will receive a 45.1 percent equity ownership stake and a $432 million cash payment at close, whereas STMicro will receive a 48.6 percent equity ownership stake and a $468 million cash payment at close. Besides, the private equity firm, Francisco Partners, will invest $150 million in the venture for preferred stock representing a 6.3 percent stake.
Dipanjan Deb, Founder and Managing Partner at Francisco Partners, said that the new company will immediately be able to offer a very broad range of non-volatile memory solutions in order to address the needs of a wide variety of customers.
Though no name has been chosen for the new company, the deal is expected to close in the second half of this year, subject to regulatory approvals and other conditions.
Meanwhile, the new company will be headquartered in Switzerland, and incorporated in the Netherlands, with nine main research and manufacturing locations around the world, and approximately 8,000 employees.
The new company's strategic focus will be on supplying flash memory solutions for a variety of consumer and industrial devices, including cell phones, MP3 players, digital cameras, PCs, and other high-tech equipment.
Reportedly, the new company will combine key research and development, manufacturing, and sales and marketing assets of Intel and STMicro into a streamlined worldwide structure with the scale to produce cost-effective and innovative non-volatile memory solutions.
Carlo Bozotti, President and Chief Executive Officer, STMicro, said that the new company would be positioned to service customers with all of the elements necessary to deliver current and next-generation non-volatile memory technologies, while allowing STMicro to redefine its participation in flash memory.
Adding to it, Paul Otellini, President and Chief Executive Officer, Intel, said that the new memory company would have the people, scale, and technology leadership to meet the needs of customers requiring leading-edge products in this highly competitive marketplace.
Under terms of the deal, STMicro will sell its Nand and Nor flash memory assets to Intel, while Intel will sell its Nor flash memory assets and resources to the former.
In exchange, Intel will receive a 45.1 percent equity ownership stake and a $432 million cash payment at close, whereas STMicro will receive a 48.6 percent equity ownership stake and a $468 million cash payment at close. Besides, the private equity firm, Francisco Partners, will invest $150 million in the venture for preferred stock representing a 6.3 percent stake.
Dipanjan Deb, Founder and Managing Partner at Francisco Partners, said that the new company will immediately be able to offer a very broad range of non-volatile memory solutions in order to address the needs of a wide variety of customers.
Though no name has been chosen for the new company, the deal is expected to close in the second half of this year, subject to regulatory approvals and other conditions.
Meanwhile, the new company will be headquartered in Switzerland, and incorporated in the Netherlands, with nine main research and manufacturing locations around the world, and approximately 8,000 employees.
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