Summary
Micron Technology Inc. (MU) has filed an 8-K report detailing the divestiture of its equity interest in the Hynix-Numonyx Semiconductor Ltd. joint venture. This move follows Micron's earlier acquisition of Numonyx. Hynix Semiconductor has exercised its option to purchase Micron's 19.34% stake in the joint venture for an estimated $422.89 million. The transaction is subject to PRC regulatory approval and will involve a final purchase price adjustment based on the joint venture's net book value at closing. In conjunction with this equity transfer, a critical supply agreement between Numonyx B.V. and the Hynix JV will be terminated. However, Micron has entered into a new supply agreement with Hynix to ensure the continued supply of products until September 30, 2011. Investors should monitor the regulatory approval process and the finalization of the purchase price, as these will impact the net proceeds from the sale and Micron's ongoing product supply chain.
Key Highlights
- 1Micron Technology is selling its 19.34% equity interest in the Hynix-Numonyx Semiconductor Ltd. joint venture to Hynix Semiconductor.
- 2The estimated sale price for Micron's stake is $422.89 million, with a portion deposited into an escrow account.
- 3The final purchase price will be subject to adjustments based on the net book value of the joint venture's assets and liabilities at the closing date.
- 4The transaction requires regulatory approval from provincial and local PRC authorities.
- 5The existing supply agreement between Numonyx B.V. and the Hynix JV will terminate upon the closing of the equity transfer.
- 6Micron and Hynix have entered into a new supply agreement ensuring product supply through September 30, 2011.
- 7A significant portion of Numonyx's revenue was previously derived from sales under the terminated JV Supply Agreement.