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Thursday, March 4, 2010

In the news

From today's edition of the Daily Yomiuri ザ・デイリー読売 ("Elpida won't need funds from Taiwan"):

"Elpida Memory Inc. エルピーだメモリー will not receive 20 billion yen ($225 million) as initially planned by a Taiwan firm set up by the island's authorities, Elpida President Yukio Sakamoto 坂本幸雄 told The Yomiuri Shimbun 読売新聞 on Tuesday. The company, which is under corporate rehabilitation, has showed recent signs of improved business due to rebounding semiconductor demand. Taiwan Innovation Memory Company was set up by the Taiwan authorities last year to reorganize the island's dynamic random access memory market."

The article provides some background information behind the decision:

"The demand for semiconductors used in household appliances and information technology related devices had declined from autumn of 2008 due to the global economic crisis. In June 2009 Elpida became the first company to which the revised Industrial Revitalization Law was applied. It planned to raise 160 billion yen ($1.8 billion), including 30 billion yen ($338 million) in public funds from the Development Bank of Japan 日本政策投資銀行 and 20 billion yen from TIMC. However, Elpida's business has taken a sharp turn for the better on demand spurred by economic stimulus measures as well as increased demand, especially in China and other emerging economies. The company posted operating profit of 30.4 billion yen ($343 million) for the October-December 2009 quarter."

Elpida is a name often seen in the business sections of Taiwan's two main English-language dailies, an example of how important chips are to this island's economy. The TIMC is a controversial attempt by the government to restructure the DRAM industry. Its intention was to consolidate three Taiwanese chip manufacturers (Powerchip, ProMOS and Rexchip Electronics) and utilize technology from Elpida, but with the market appearing to pick up again, the fate of the state-backed venture is up in the air.

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