Bain Capital Resumes Talks for Memory Chip Merger Amidst SK Hynix Opposition
Bain Capital is reportedly engaged in discussions with SK Hynix (000660.KS) to resume negotiations aimed at merging memory chip manufacturers Western Digital (WDC.O) and Japan’s Kioxia Holdings, according to information from Kyodo newswire citing undisclosed sources.
As a significant player in the memory chip industry, SK Hynix serves as both a competitor and an investor in Kioxia. The merger discussions, which have experienced intermittent progress since 2021, encountered a setback in October. At that time, SK Hynix expressed opposition to the deal, citing concerns about the potential impact on the value of its investment in the Japanese company.
In 2018, SK Hynix, as part of a Bain-led consortium, invested 395 billion yen ($2.67 billion) in Kioxia, acquiring the firm from Toshiba Corp. Notably, SK Hynix holds bonds with the option to convert them into an equity stake of up to 15%. Its approval stands as a crucial precondition for advancing the merger talks.
These negotiations mark a pivotal point in the ongoing dynamics of the semiconductor industry, with the involvement of key players and intricate financial considerations influencing the potential merger between Western Digital and Kioxia.
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