Micron Now Owns a Piece of Apple

Micron

Being about 45 minutes from my current home, I had visited Micron when I was in high school, and I loved the facility, and it looked like a place I could work, then it came to the clean rooms. I then realized I couldn’t do the work because I wouldn’t be able to see with the sweat that would come down my brow due to the suit that one has to wear in that location of the building. So when this news came out I was happy that they are doing well, not only because it’s great for business, but it’s great for the local community because there are more jobs that will be coming in the near future.

Micron, the memory maker based out of Boise, Idaho, has completed its acquisition of Elpida, a struggling DRAM player in Tokyo. All of Elpida’s equity and assets now belong to Micron, including a 300mm DRAM fabrication facility located in Hiroshima, Japan. Other notable assets include a 65 percent stake in Rexchip, which itself owns a 300mm DRAM plant in Taiwan, and 100 percent ownership interest in Akita Elpida Memory, which owns an assembly and test facility in Akita, Japan.

“We are pleased to bring together Elpida with Micron to form the industry’s leading pure-play memory company. This combination will result in enhanced R&D and manufacturing scale, significant cost and production synergies and a stronger memory product portfolio to provide solutions to our customers,” said Micron CEO Mark Durcan.

The move also ensures Micron’s continued presence in an industry that’s made a sharp transition to survival of the fittest in the past several years. Starting around 2008, the DRAM market took a turn for the worse, prompting Adata to say it had been the worst year for DRAM in 15 years. According to Micron, the manufacturing assets of Elpida and Rexchip together can produce more than 185,000 300mm wafers per month, which represents about a 45 percent increase in Micron’s current manufacturing capacity.

Micron, which has reported a net loss in five out of its last 10 fiscal years, now has enough scale in the maturing industry to whether price swings that have eroded profits in the past, Chief Executive Officer Mark Durcan said. “I believe that Micron, to a greater extent than ever before, controls its own destiny,” Durcan said. “We have enough scale, we have enough resources. I’m a true believer that the memory industry going forward is going to be a much, much better industry,” Durcan said. He sees a future for Micron when “in the worst of times we’re still making a little bit of money. In the best of times, we’re doing very well indeed.”

Apart from gaining market share, Elpida’s capabilities in DRAM chips tailored for mobile phones are also important for Micron, Durcan said. Elpida, a supplier to Apple Inc., gives Micron new products, and the total size of the combination gives it enough scale to service larger customers, he said.

So, when it comes down to it, it’s a great thing all around. I now feel that Micron has now become a part of Apple in the sense that what Micron makes goes into Apple products. This is a great thing for all involved. Great job Micron on your purchase.

Forrest L. Rawls

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