Hynix inching toward Micron offer


Hynix CEO Park C.S. was expecting a deal by the end of January but was forced to back off that call

By Alex Frew McMillan
CNN Hong Kong

SEOUL, South Korea -- Hynix Semiconductor looks closer to signing a deal with Micron Technology of the United States.

Micron has increased its price for the core memory business of the Korean company by $700,000, according to a report.

The Idaho-based company is now offering about $3.8 billion for the hub of Hynix, according to the Financial Times.

That's up from a $3.1 billion original offer, which left a $2 billion gap between what the seller wanted and what the bidder was offering.

Micron was forced into the move after German chipmaker Infineon confirmed it is in talks with Hynix on a merger.

"Micron took the Infineon talks very seriously and came back to us quickly with an improved offer," a banker at one of Hynix's creditors told the FT.

The tangled web of alignments in the memory-chip industry got even more complex Friday, when Samsung Electronics Co. confirmed it had also had casual discussions with Hynix on a combination.

Everybody talking to Hynix

That means all the top players in the industry have now been in talks with Hynix. The Seoul-based company, the world memory-chip No. 3, is looking to sell some or all of its operations to reduce its massive debtload.

Infineon's CEO, Ulrich Shumacher, was in Seoul on Friday. Meantime Micron's CEO, Steve Appleton, was slated to address analysts that day but pulled out at the last minute because he was sick.

Appleton is expected to make a materially important statement about his company's efforts to buy some or all of Hynix.

Hynix stock was down 4.4 percent at 2,500 won shortly before the close. The main Kospi index was 1.4 percent lower.

Rival Samsung Electronics was up 0.8 percent, at 311,500 won. Its stock has gained steadily on problems at its main rival.

According to the FT, some of the Korean company's bankers are now keen to accept Micron's offer. Others are holding out for more money, but the Infineon talks may have been leaked to spur Micron into action.

Hynix had been slated to do a deal with Micron before the American company bought the U.S. memory chip factory of Japan's Toshiba Corp.

Japanese chipmakers have been looking to exit the memory-chip business, faced with tough competition from their Korean counterparts.

After that deal, Micron executives said they were no longer as keen on a deal with Hynix.