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Micron Acquires Elpida and the Future of Computer Memory for $5 Billion

Micron DRAM Memory

The modern world has ton of companies that were on the verge of making a revolution, only to exhaust its cash reserves and crash before they could change the world. Regardless of are we talking about 3dfx and 48-bit color, or Elpida and ReRAM i.e. Resistive RAM – the story remains the same.

In the very recent past, we saw many of long-lasting industry standards coming to pass, but the basic principle how computer operates – hasn’t changed in a very long time. Regardless of being a mainframe, server, desktop or a smartphone, the principle is the same – computing logic (CPU, GPU, SoC) has several layers of immediate memory (Level 1-3), followed by the system memory (Level 4) and ending with storage subsystem (5th level onwards). That subsystem ranges from a hard drive or a USB stick to large external storage boxes (NAS – Network Area Storage).

But what if a technology comes along that unifies the system memory with the storage, and offers bandwidth exceeding the one offered by the Level 1 memory (L1 cache, for example)? Last year, we saw Micron and Intel Demonstrating Hybrid Cube Memory, a 512MB stacked DRAM which achieved bandwidth of 128GB/s from a single chip (imagine a CPU with 4 memory channels and 512 GB/s).

That concept is just the beginning. ReRAM or Resistive RAM is considered to be the next phase of memory, supporting the pairing with DRAM and NAND Cells, and ready to replace both in the future. Elpida was considered as the company closest to mass production but due to turmoil in the DRAM industry and as one of consequences of big earthquake in Japan – had to file for bankruptcy in March 2012.

Enter Micron – the company announced that “the parties have signed a definitive sponsor agreement for Micron to acquire and support Elpida.” For 200 billion yen, i.e. 2.5 billion U.S. Dollars will be paid off to Elpida’s creditors (secured and unsecured). Furthermore, the company will acquire Elpida as a company for $750 million, as well as additional $1.75 billion secured in annual payments going until 2019. This caused another shakeup on the Taiwanese market as well, as Micron acquired 24% Share of Rexchip Electronics Corporation for about $334 million. Elpida owned 65% of Rexchip, bringing Micron’s share to 89%.

Jointly, Elpida and Rexchip can manufacture more than 200,000 300mm wafers (wspm), increasing Micron’s overall capacity to massive 600,000 wafer starts per month (all foundries manufacture chips using 300mm wafers).

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