American giant Intel has just agreed to sell its NAND business, which specializes in flash memory, for $ 9 billion in favor of South Korean company SK Hynix.
A strategic sale for the American
This sale should allow Intel to focus on other activities, including artificial intelligence, 5G, and quantum computing. Bob Swan, CEO of the company, said, “This transaction will allow us to better prioritize our investments in differentiating technologies, playing a greater role in our customers’ success and delivering attractive returns to our customers. our shareholders ”. A strategic choice of paramount importance.
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This agreement logically makes SK Hynix one of the largest SSD manufacturers in the world, right behind Samsung Electronics. Intel executes its strategy over the months. Last year the company had already sold most of its smartphone modems business to Apple for around $ 1 billion. Intel would now like to concentrate on a few very specific areas in order not to scatter.
Intel is selling its NAND office to focus on other activities
SK Hynix, the Seoul-based company that buys the American giant’s operations, is taking over the torch of two divisions: SSDs and NAND components (with NAND foundry in Dalian, China). Intel states that Optane activity will be maintained. A division that makes SSD storage modules that ultimately appears to be profitable for the company. Final regulatory approval is expected by the end of 2021, and the final closure of all assets, including intellectual property related to NAND, will not occur until March 2025.
Intel plans to use the $ 9 billion to advance its long-term growth priorities, including in areas of artificial intelligence, 5G and quantum computing. In particular, Intel plans to produce a 1000 qubit quantum processor by 2023. Until it is sold, Intel will continue to manufacture wafer NAND at its Dalian facility. This foundry is Intel’s only large plant in China. This acquisition will therefore inevitably reduce the company’s presence in China.
It is perhaps no coincidence that we know that the US government has been imposing trade restrictions on products made in China for several months, even by American companies. Google in particular plans to move production of the Pixel from China to Vietnam, and Apple says it could withdraw between 15% and 30% of its production from China. Seok-Hee Lee, CEO of SK Hynix, said the deal will allow the South Korean company to optimize its business offering over NAND.