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Micron wants equity swap

US microchip giant Micron Technology Inc hopes to take management control of South Korea's Hynix Semiconductor Inc through a stake swap and debt write-offs, reports said yesterday.

Micron has insisted Hynix should turn over more than 25 percent of its equities, the Munhwa newspaper in Seoul said.

The proposal came at a second round of talks last week on forging a strategic tie-up between the two companies, it said, adding Micron is trying to pay through stocks rather than cash. Hynix, the world's third largest microchip maker, regards the stake swap as a tool to pull off strategic ties with Micron but is reluctant to turn over more than 20 percent of its shares, Munhwa said.

Hynix and creditors refused to confirm the report. But other newspapers said Micron insisted on writing off a considerable amount of Hynix's debt.

Hynix has estimated debts of 11.6 trillion won (US$9.1 billion). Creditors have promised to turn part of their loans into equities.

Micron's tough proposal came after the US company agreed to buy the US semiconductor unit of Japan's Toshiba Corp.

Micron chief executive Steve Appleton has stressed the Toshiba deal is separate from Micron's alliance talks with Hynix. But the Toshiba deal has weakened Hynix's position.
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