Elpida Buying Flash Technology Assets from Spansion

In order to address the growing demand for smart phones and develop a stronger footing against South Korean competitors, Japan's biggest memory maker Elpida Memory Inc. is said to be buying the flash technology assets from Spansion Inc., BusinessWeek reported this week.

The purchase reportedly includes Spansion’s R&D facility in Milan, Italy, along with IP rights; and Elpida intends to develop semiconductors that combine Spansion’s technologies with its own.

The Sunnyvale, California-based Spansion has not been in the black since it began – it was launched in July 2003 as a joint venture between Advanced Micro Devices Inc. (AMD) and Fujitsu Ltd – and filed for bankruptcy protection in March 2009. The company’s Japanese unit that operates a 300mm line making NOR flash for mobile phones, sought protection under the Corporate Reorganization Law of Japan in February 2009.

Last July, Spansion said it expected to emerge from Chapter 11 by the end of 2009, and in August, said it would sell its Suzhou facility for $31 million.

Following nine consecutive quarters of loss at Elpida, the Spansion deal could provide another source of revenue for the company, and potentially give it a competitive edge against rivals. It has been estimated that the purchase price could be as high as $57 million, the BusinessWeek article said.

Following a request for comment, Spansion told EDN in an email, "The agreement between Spansion and Elpida concerns a small portion of Spansion's research and development assets. The transfer does not impact Spansion's operations or strategy to focus on embedded and targeted wireless applications. Further details of the agreement are not being discussed at this time."

Elpida Memory

Spansion