Japan’s troubled chipmaker Elpida Memory Inc is expected to receive about ¥200 billion (US$2.1 billion) in public and private financial aid over three years, a newspaper reported yesterday.
Under the plan, the government-backed Development Bank of Japan (DBJ) would acquire preferred shares in the company, with the government effectively guaranteeing 80 percent of them, the Nikkei Shimbun said.
The government is expected to officially approve about ¥30 billion in capital for the chipmaker as early as next week, the newspaper said.
The DBJ separately plans to offer ¥10 billion in loans to Elpida, while the Japan Bank for International Cooperation, another government-run bank, would provide between ¥20 billion and ¥30 billion in emergency loans, the Nikkei said.
A syndicate of Japan’s three megabanks and others is expected to lend about ¥100 billion to Elpida, it said, adding that a public-private fund that supports innovation would also consider providing tens of billions of yen.
Elpida — the world’s third-largest maker of dynamic random access memory chips used in mobile phones and home electronics — has been hit hard by tough business conditions amid the global downturn.
Taiwan Memory Co (台灣記憶體公司), a company set up by the Taiwanese government to reorganize the nation’s semiconductor industry, picked Elpida as its strategic partner in April and could buy less than a 10 percent share in the Tokyo-based company.
The Japanese government launched a program to support ailing companies in April, as Asia’s biggest economy grapples with its worst recession since World War II.
More Japanese companies are expected to follow suit and ask for help.
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