Micron to Buy Va. Toshiba Plant
Jan. 18, 2002
BOISE, Idaho (AP) _ Micron Technology will pay Toshiba $250 million in cash plus 1.5 million shares of Micron stock for a memory chip plant in Virginia, according to a document filed with the Securities and Exchange Commission.
If Micron were to build from scratch a facility similar to the 600,000-square-foot Dominion Semiconductor fabrication plant, it would cost five to 10 times that amount, analysts said.
``$250 million is not a lot in terms of a company the size of Micron,'' said Sherry Garber, an analyst with Semico Research Corp. in Phoenix. ``Were they to build a new facility, it's very likely it could cost over $3 billion today. They got a very good deal.''
The companies signed a memorandum of understanding on Dec. 18. No terms were not disclosed until the SEC filing this week. The deal is expected to close in the first quarter of this year.
Micron Chairman and Chief Executive Officer Steve Appleton said last month that the cash outlay in the acquisition would be insignificant to the company. The terms still leave Micron in a strong financial position.
The Toshiba purchase will have no impact on any potential alliance with Korea's Hynix Semiconductor, with whom Micron has been negotiating for more than a month. Hynix is the world's third-largest DRAM memory chip producer, with 13 fabrication plants worldwide. Micron is the world's second-largest DRAM producer.