On October 19, Micron Technology announced on Thursday that it would acquire a stake in a flash joint venture with Intel that was formed more than a decade ago.
Micron agreed to spend $1.5 billion to acquire shares in IM Flash Technologies held by Intel and expects to complete the transaction six to 12 months after the purchase option is exercised on January 1 next year. The company's CFO Dave Zinsner said at the meeting that Micron will pay for the purchase through free cash flow and plans to continue to buy back its own shares.
"We have calculated whether this is a good deal, and I think the return on investment is very good." He pointed out that IM Flash's Utah plant has already received a total investment of 6 billion US dollars.
Kingsner also added that the Utah plant is not only close to the company's headquarters in Idaho, but also the only factory in the world that can produce 3D XPoint technology. This non-volatile storage improves storage performance and reduces server storage costs.
Micron and Intel recently announced that they will complete the development of the second generation of 3D XPoint technology before the end of the first half of 2019. Under the existing agreement, Micron will sell Intel's 3D XPoint wafers for up to one year after the transaction.
"Micron's acquisition of IM Flash demonstrates our confidence in 3D XPoint technology and other emerging storage technologies, and believes this will be a unique differentiation factor for the company and will be the core solution for new data-intensive applications." President of Micron And CEO Sanjay Mehrotra said.
Before the end of the transaction, the two companies will continue to produce 3D XPoint storage products at their Utah facility. In 2012, Micron and Intel expanded the size of the joint venture formed in 2006.