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Why a Chinese Buyout of Micron Is Not Likely To Succeed
Lucas123 writes: A reported $23 billion offer to purchase U.S.-based Micron, one of the largest DRAM and memory makers in the world, by a Chinese state-owned chip maker isn't likely to succeed for several reasons, not the least of which is that the U.S. government is unlikely to approve it and Micron has no reason to sell. Tsinghua Unigroup, a somewhat enigmatic company that is funded by Tsinghua University in China, offered $21 a share for Micron, which is a 19.3% premium over Micron's closing price on Monday. Micron's market cap is currently $20.7 billion. Micron has denied it received an offer from Tsinghua, but a Wall Street Journal report claimed the offer was real.
Industry analysts, however, believe Tsinghua may have used the WSJ as a trial balloon for an offer. Analysts also say rumors of a deal for Micron have been floating around for more than a month. Still, the possibility of a deal surprised some in the industry who expected China to organically grow its own DRAM and memory businesses. By acquiring Micron, however, China would instantly become a big player in what is a robust market. Fang Zhang, an IHS memory analyst, said Micron will not likely accept a buyout offer because the company has been performing well and expects to continue to do so. Additionally, the U.S. government considers chip technology vital to national security, so approval of the deal would at the very least take months if not more than a year during a time when the Chinese economy is at risk of collapse.
Industry analysts, however, believe Tsinghua may have used the WSJ as a trial balloon for an offer. Analysts also say rumors of a deal for Micron have been floating around for more than a month. Still, the possibility of a deal surprised some in the industry who expected China to organically grow its own DRAM and memory businesses. By acquiring Micron, however, China would instantly become a big player in what is a robust market. Fang Zhang, an IHS memory analyst, said Micron will not likely accept a buyout offer because the company has been performing well and expects to continue to do so. Additionally, the U.S. government considers chip technology vital to national security, so approval of the deal would at the very least take months if not more than a year during a time when the Chinese economy is at risk of collapse.
Additionally, the U.S. government considers chip technology vital to national security,
Potato chips, that is.
Have gnu, will travel.
But didn't that boat sail 25 years ago?
"I don't know, therefore Aliens" Wafflebox1
You live in a fantasy world, if you believe the Chinese wouldn't want access to everything. The actions of these superpowers are not limited by morale, only capabilities. And the Chinese capabilities are steadily growing.
Patents Drive Free Software as Hurricanes Drive Construction Industry
**citation needed...
But didn't that boat sail 25 years ago?
Most of the most fancy-pants fabs are here in the US of A. You never hear about them because, unlike other industries, they spend enough money to prevent horrible industrial accidents.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"