LONDON – SK Hynix Inc. (Icheon, South Korea), the world's second largest DRAM maker, has dropped its bid for Elpida Memory Inc. according to reports that referenced a regulatory filing in Seoul Friday May 4.
Elpida (Tokyo, Japan) has about 12 percent of the global DRAM market but prices for DRAMs are depressed due to an oversupply of components. They are used heavily in personal computers but less so in mobile devices. Elpida filed for bankruptcy protection in February with reported liabilities of 448 billion yen (about $5.6 billion) after failing to win a government bailout package.
Toshiba had reportedly also expressed some interest in Elpida but then withdrew.
The withdrawal of SK Hynix and Toshiba leaves a potential bid from Chinese investment firm Hony Capital teamed with U.S. private equity firm TPG in play and the possibility of a bid from DRAM maker Micron Technology Inc. (Boise, Idaho).
Hony Capital, founded in 2003 by John Zhao, has specialized in the buy-out of China state-owned enterprises and now has $6.8 billion in assets under management. TPG, formerly Texas Pacific Group, has $49 billion of capital under management.
Related links and articles:
Reports: China's Hony and TPG team to bid for Elpida
Toshiba reportedly bows out of Elpida bidding
Reports: Toshiba, Micron, Hynix to bid for Elpida