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Samsung and SK Hynix shares slide on Apple snub

Memory-makers hurt by losing contract to bankrupt Elpida

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Shares in Samsung have fallen over 6 per cent on news that Apple preferred to place huge chip orders with bankrupt firm Elpida Memory.

It was reported in Taiwan yesterday that Apple had booked up half of the mobile DRAM capacity at Elpida's plant in Hiroshima for future iPhones and iPads.

Despite the multiple patent battles between Samsung and the fruity firm, the Korean electronics giant has been its go-to chip firm as the leader in mobile DRAM, and shifting Apple business to another memory-maker could put a significant dent in that lead.

SK Hynix stocks were similarly hit on the news and promptly dropped by 8.89 per cent.

With Elpida on the ropes, the DRAM market had narrowed, leaving Samsung and SK Hynix out in the lead. Elpida had been struggling to find a buyer, seeing Toshiba and SK Hynix drop out of the race, but US firm Micron now looks likely to bag the bankrupt firm's remains.

A massive contract with Apple will set the new Micron/Elpida hybrid up in a big way, giving it a decent chance of stealing some market share back from the leaders. Which would be nice for Apple, because with more big boys in the sector, the fruity firm can muster up a bit of competition for its contracts and get a better deal. ®

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