Shares of Winbond Electronics Corp (華邦電子) surged 2.15 percent yesterday in Taipei trading on speculation that the memorychip maker was considering buying Micron Technology Inc’s NOR flash memory business.
Winbond’s shares closed at NT$11.9, their highest in about a week, while the TAIEX only rose 0.48 percent.
Winbond shares rallied after the Chinese-language Economic Daily News reported that the Hsinchu firm was seriously studying the feasibility of acquiring Micron’s NOR flash memory business, which, if the deal is completed, would make it the biggest NOR flash memory supplier with a 37 percent share of the market.
LOOKING FOR AN EXIT?
The newspaper said Micron was seeking potential buyers because it wants to exit the sector, citing unspecified semiconductor equipment suppliers as saying a continued price decrease has significantly reduced revenue contribution from NOR flash memory.
DRAM and NAND flash memory chips have become major revenue sources for the US chipmaker, the newspaper said.
According to Micron’s financial statements, DRAM chips accounted for 61 percent of its total revenue amounted US$3.97 billion during its fiscal first quarter of this year.
Winbond and Chinese NOR flash chipmaker GigaDevice Semiconductor (Beijing) Inc (兆易創新) were on Micron’s short list to sell its NOR flash business, the paper said.
However, Winbond would appear to have a greater chance of winning the deal, given the bumpy start in US-China trade relations under US President Donald Trump’s new administration, it said.
Winbond yesterday responded to media speculation in a statement to the Taiwan Stock Exchange saying the Economic Daily News’ report was groundless.
Winbond was not the only memorychip maker that out-performed the broad stock market yesterday.
DRAM chipmaker Nanya Technology Corp (南亞科技) saw its share price jump 2.95 percent to NT$47.1, driven by the strong outlook for the industry.
“We expect DRAM prices to keep rising in the upcoming two quarters,” Nanya president Lee Pei-ing (李培瑛) said by telephone. “The price increases this quarter will be bigger than we expected as supply constraints continue.”
Lee’s comments came after the company posted a monthly decline of 4.59 percent in revenue last month at NT$4.07 billion (US$131 million) from NT$4.26 billion in December last year. The contraction was largely due to fewer working days last month, causing a 14 percent reduction in shipments.
DRAM prices soared 12 percent last month alone, as tight supply boosted chip prices, especially prices for some new longer-term supply contracts, Lee said.
That will help lift Nanya Technology’s gross margin further during the current quarter, from 31.1 percent in the final quarter of last year, he said.
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