South Korea: Hynix could grab stake in Toshiba’s chip business

A deal for Japanese conglomerate Toshiba to sell its chip-making business to the Japanese government and a private equity investor could eventually see South Korea’s SK Hynix pick up a stake in the unit, the Wall Street Journal reports.

State-backed fund Innovation Network of Japan, alongside government-owned Development Bank of Japan are currently in talks with beleaguered Toshiba to buy 66% of the semiconductor unit, with the remaining stake going to US private equity firm Bain Capital. However, in what is the latest twist in an increasingly convoluted saga, the Journal says that rival semiconductor maker SK Hynix could at some point in the future pick up some or all of Bain’s stake in the business. The newspaper cites people familiar with the negotiations.

That is likely to irk US-based hardware maker Western Digital, a Toshiba partner whose efforts to acquire the chips business have so far been frustrated. Last week Toshiba sued Western Digital for US$1 billion, alleging the company was meddling in the sale of the chip-making unit and had improperly obtained intellectual property. The involvement in SK Hynix raises further questions, such as the Japanese government’s position on sensitive technology ending up in the hands of a foreign competitor. Meanwhile, Toshiba hasn’t publicly disclosed that SK Hynix could be involved in the upcoming sale.

Full Content: Wall Street Journal

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