No government rescue for Hynix
Micron rumour returns
Any lingering hopes that directors and shareholders of Hynix Semiconductor Inc might have that the South Korean government may yet rescue the company were dashed yesterday, as Finance Minister Jeon Yun Churl warned that Hynix may be close to imminent collapse and declared there would be no government intervention.
Jeon's remarks stirred an already steaming pot of rumor surrounding Hynix's fate, which included reports in the Korean media that Micron Technology Inc could yet be persuaded to resume negotiations with the company.
Jeon's statement came during a speech to a Korean economic forum, and carries the weight of a man who ultimately has the final say in Hynix's future. The company is massively indebted to a cluster of merchant banks, the biggest of which are all Korean state-owned ventures, such as the Korean Exchange Bank.
Jeon's bald statement that it is the creditors who must control the fate of Hynix, is close to being an official government endorsement for a strategy that will see Hynix sold to the highest bidder, and in job lots if necessary.
The prospect that Boise, Idaho-based Micron will once again be the front-runner in any Hynix sale was floated by the Korean Economic Daily, which cited remarks made by Salomon Smith Barney Inc vice chairman and CEO, Jeffrey Shafer. The US bank was Hynix's adviser during the last round of talks with Micron, which collapsed last month when Hynix's board unanimously voted against Micron's $3bn offer for Hynix's DRAM business.
Since those talks collapsed, Salomon Smith Barney was replaced as Hynix's key adviser by Deutsche Bank AG and Morgan Stanley.
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