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Micron, Hynix confirm talks

Talking about discussions about negotiations

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Micron has confirmed it is talking to Hynix - the subject: the merger of the two chip companies' memory operations.

In a terse press release, the two companies said they will today begin exploratory discussions "regarding a possible strategic alliance or other transaction".

We can't say we're surprised. Micron has, after all, never denied it's talking to other memory companies, as a spokesman admitted last week. We've been talking to everyone except Samsung, he said in response to a report in the Korean press that Micron CEO Steve Appleton was talking to Hynix.

Given the depressed nature of the memory market - recent spikes in DDR SDRAM prices notwithstanding - some degree of consolidation is only to be expected. Companies have been talking to each other, looking for partnerships, perhaps even merger partners, in a bid to find the best way to end the downturn - or at least survive it.

Infineon, for instance, has already been talking to Toshiba, a variety of Taiwanese memory makers and, quite possibly, Hynix too (though we suspect not, given chief executive Ulrich Schumacher's coolness to Hynix and Samsung). Toshiba is hawking its loss-making memory business around possible partners.

In this context, Micron's talks are not out of the ordinary. The announcement of the fact is possibly more about dampening investor enthusiasm than a real sign that a full-blown merger is on the cards. ®

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