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Intel-ST JV gets permission from EC

Posted: 16 Aug 2007     Print Version  Bookmark and Share

Keywords:Intel-ST JV  flash memory  EC green light  joint venture 

Intel Corp. and STMicroelectronics have secured permission from the European Commission (EC) to form a joint-venture company with assistance from Francisco Partners LP.

The intention to form the flash memory joint venture was announced May 2007. The EC concluded that the transaction would not significantly impede effective competition in Europe or any substantial part of it.

The EC said in a statement that it had found that strong competitors are present in Europe for both the NOR and NAND forms for flash memory and customers would be able to continue sourcing their needs from a sufficient number of alternative vendors. The merger is due to see 8,000 employees move to a new Swiss-headquartered joint venture in NOR and NAND flash memory that will also encompass developments in chalcogenide phase-change memory.

Under the agreement, STMicroelectronics will sell its flash memory assets, including its share in a China joint venture with Hynix Semiconductor Incand other NOR resources, to the new company, while Intel will sell its NOR assets and resources.

In return, Intel gets a 45.1 percent equity ownership stake and a Rs.1,747.37 crore ($432 million) cash payment at close. STMicroelectronics is due to receive a 48.6 percent equity ownership stake and a Rs.1892.98 crore ($468 million) cash payment at close. At the same time, Francisco Partners will invest Rs.606.72 crore ($150 million) in cash for convertible preferred stock representing a 6.3 percent ownership interest, subject to adjustment in certain circumstances.

- Peter Clarke
EE Times Europe

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