Intel sells its NAND memory division to SK Hynix for $ 9.000 billion

The Intel Optane product range has always been pretty weak when it comes to performance. This has caused that their products do not finish well in an extremely competitive market. For this reason, Intel has sold its NAND memory division and its storage business to SK Hynix. Intel sure selling its Intel Optane products, but in this case with SK Hynix memories

The agreement between both companies has been closed for 9.000 million dollars. Although it is a division of Intel that works quite well, the company wants to focus on its processors. Currently the delay of 10nm is enormous and they need to put more muscle to recover all the lost ground.

Agreement closed between Intel and SK Hynix

SK Hynix just takes Intel's NAND memory and storage business for $ 9.000 billion. This operation includes the SSD, wafer, NAND components business and the Dalian NAND memory manufacturing plant located in China. Intel only keeps its brand and its Optane business.

Now both companies will work to obtain government permits to close the operation, which will be at the end of 2021. Once they have the permits, SK Hynix will make a payment of 7.000 million dollars for the NAND SSD business and the Dalian factory. The remaining amount will be for the intellectual property to manufacture and design NAND Flash wafers, R&D and various fringes for the Dalian factory. This second payment would not be made until March 2025.

This operation is sure to cause discomfort in Samsung or Micron, who compete with SK Hynix in the memory market. The position of the South Korean company is greatly strengthened in this agreement. This seeks to create a stronger ecosystem to attract new customers, partners, workers and shareholders. SK Hynix has been one of the promoters of DDR4 RAM and more recently of DDR5 memories.

Intel has some innovative technologies on the market for NAND SSD and NAND Flash QLC products. This division in the first 6 months of 2020 generated 2.800 billion dollars, so the return on investment would be relatively fast.

Collaboration between the two companies

The agreement between both companies will affect customers, suppliers and workers, since a transition will be made as comfortable as possible. The money obtained from the agreement will be invested by Intel in Artificial Intelligence, 5G networks and several long-term projects. The two companies will also work together to improve the development of memory semiconductors.

I am pleased to see that SK hynix and Intel's NAND division, which have led the innovation of NAND flash technology, are working together to build the new future.

SK hynix will proactively respond to diverse customer needs and optimize our business structure.

Seok-hee lee, CEO of SK Hynix

I am proud of the NAND memory business we have built and believe that this combination with SK hynix will grow the memory ecosystem for the benefit of customers, partners and employees. For Intel, this transaction will allow it to prioritize investments in differentiated technology.

Bob Swan, CEO of Intel