Micron Technology, Inc. is exercising its right to purchase Intel’s interest in the parties’ joint venture, IM Flash Technologies, LLC (IM Flash).
This is a natural progression from the announcement made in July 2018 that the two companies had agreed to conclude their joint development of 3D XPoint technology after the completion of the second-generation node
“The IM Flash acquisition will enable Micron to accelerate our R&D and optimize our manufacturing plan for 3D XPoint,” said Micron Technology President and CEO Sanjay Mehrotra. “The Utah-based facility provides us with the manufacturing flexibility and highly skilled talent to drive 3D XPoint development and innovation, and to deliver on our emerging technology roadmap.”
"There is no near-term change to Intel’s plans in the coming quarters. The close of the call is at Intel’s discretion for up to one year as of today. This was expected and has been part of Intel’s planning for some time. Intel has manufacturing options available and has been shipping a broad portfolio of Intel Optane technology products for more than a year. Intel will continue to expand its product line and lead the industry with this exciting new technology," Intel said.
Micron anticipates that the pending acquisition will have no meaningful impact on overall non-GAAP financial results and foresees no changes to the company’s fiscal 2019 capital expenditures or long-term capital expenditure target. Micron has already consolidated the IM Flash joint venture, as reflected in its most recently reported financial statements.
At the time of close of the transaction, Micron expects to pay Intel approximately $1.5 billion in cash. The payment will end Intel’s noncontrolling interest in IM Flash and eliminate IM Flash member debt on Micron’s balance sheet, which was $1 billion as of Nov. 29, 2018.