Author: Tronserve admin
Thursday 29th July 2021 05:42 PM
Toshiba Memory to Buy Taiwan Storage Device Maker
Toshiba Memory Holding will buy the solid state drive (SSD) business of Taiwan's Lite-On Technology for $165 million, the chipmaker said Friday, looking to bolster operations with an eye on a possible stock market debut.
The purchase is expected to close by the first half of 2020. Lite-On is a key buyer of Toshiba's NAND memory chips, which it uses to build the drives. It also produces parts for servers, computers and automobiles.
Toshiba managed 17.6% of the worldwide market for NAND memory in 2018, but its share for solid state drives was under 10%, in accordance with IHS Markit. The company hopes to catch up with opponents like Samsung Electronics, which enjoys a share of more than 35% in both. The global market for solid state drives totals up to $30 billion. Inspite of flagging demand from data center servers, the market is anticipated to be expanded over the long term with the rise of artificial intelligence and 5G connections.
Toshiba Memory was spun off from the Toshiba group in June 2018 and is owned by a coalition that includes Bain Capital. It intends to carry out a primary public offering by the end of the fiscal year in March. The holding company logged a net loss of 95.2 billion yen ($896 million) for the April-June quarter.
"Solid state drives face less volatility in demand than NAND," which is a commodity product, one analyst said. Stronger solid state drive operations potentially will help Toshiba Memory stabilize its earnings. Lite-On's joint solid state drive venture with China's state-run Tsinghua Unigroup will not be part of the acquisition.