SK Hynix buys Intel's NAND business for $9 billion

It's official: SK Hynix is buying Intel's storage business for $9 billion.

Semiconductor titan SK Hynix has purchased Intel's NAND segment in a sweeping $9 billion deal. The South Korean memory-maker will spend $7 billion upfront to acquire three parts of Intel's business: NAND SSD IP and employees, NAND components and wafers including R&D employees, and the Intel Fab 68 plant in Dalian, China. Intel will keep the Optane brand.

SK Hynix will spend the additional $2 billion once the deal closes in 2025, and Intel will continue designing manufacturing flash memory at the Dalian plant until closing.

Despite the uncertain, volatile memory market, Intel's NSG branch earnings jumped 76% to $1.7 billion. SK Hynix bought Intel for the company's innovative QLC flash memory, NAND R&D advancements, and established manufacturing facilities.

Here's a few tidbits from the press release announcement:

SK hynix developed the world's first Charge Trap Flash (CTF)-based, 96-layer 4D NAND flash in 2018 and 128-layer 4D NAND flash in 2019. SK hynix will combine Intel`s solutions technology and manufacturing capability in order to establish a higher value-added 3D NAND solutions portfolio including enterprise SSDs.

Intel intends to invest transaction proceeds to deliver leadership products and advance its long-term growth priorities, including artificial intelligence, 5G networking and the intelligent, autonomous edge.

Intel and SK hynix will work together to ensure a seamless transition for customers, suppliers and employees. The two companies will work collaboratively as they did recently with DDR5, to better serve the growing demand from the memory-based semiconductor ecosystem.

"I am pleased to see SK hynix and Intel`s NAND division, which have led the NAND flash technology innovation, work to build the new future together," said Seok-Hee Lee, Chief Executive Officer (CEO) of SK hynix. "By taking each other`s strengths and technologies, SK hynix will proactively respond to various needs from customers and optimize our business structure, expanding our innovative portfolio in the NAND flash market segment, which will be comparable with what we achieved in DRAM."

Bob Swan, Intel CEO said, "I am proud of the NAND memory business we have built and believe this combination with SK hynix will grow the memory ecosystem for the benefit of customers, partners and employees. For Intel, this transaction will allow us to further prioritize our investments in differentiated technology where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders."