Micron Technology Inc. could build a stronger research and development operation on its Boise campus if the company succeeds in buying a bankrupt Japanese semiconductor producer, Microns No. 2 executive says.
It is going to expand our revenue line, Micron President Mark Adams told the Idaho Statesman on Wednesday. It is going to expand our need to develop a broad set of products, which falls back to continued investment in research and development.
Micron announced in May that it has exclusive rights to negotiate with Elpida Memory Inc., which filed for bankruptcy in February.
Micron is pursuing the acquisition even though the company has lost $924 million over the past four quarters. Micron on Wednesday reported a $320 million loss for the quarter ended May 31, higher than the $282 million reported in the previous quarter. But it still has $2.7 billion in cash and investments.
The company reported $2.2 billion in quarterly sales, about the same as a year ago.
Research and development has become the focus of Boises Micron campus since the company ended chip production here about four years ago, laying off 3,000 employees. The company now employs an estimated 5,600 people in Boise.
Acquiring Elpida could mean the Boise operation would expand in other ways, too, said Mike Howard, an IHS iSuppli semiconductor analyst and former Micron employee. The company would likely need more help in human resources, legal departments or corporate marketing if it takes on Elpida, he said.
Elpida might have had an indirect effect on the closure of Transform Solar, a joint venture between Micron and an Australian company to produce solar cells at a Nampa plant. The plants closure, which Micron attributed to a tough solar market, will cost 250 jobs.
Micron will focus more closely on the memory market in its capital investments after its announcement last month to end the joint venture, said Mark Durcan, Micron CEO, in a conference call with analysts after the earnings report.
Adams said the opportunity to buy Elpida means our priorities shift a little bit, and we think about what we can afford, given our balance sheet and the projection of our business going forward. And that really drives our behavior.
Howard predicts a strong semiconductor market in the second half of 2012. Durcan told analysts that the wind is at Microns back, despite a drop in the prices for NAND flash memory, which is used in consumer products that hold digital pictures, music and movies.
Micron officials would not discuss when a deal with Elpida might be made. Elpida listed $5 billion in liabilities. Micron hopes to get the company for a fraction of that amount.
Bill Roberts: 377-6408, Twitter: @IDS_BillRoberts