Micron Technology Inc.s purchase of bankrupt Japanese entity Elpida Memory Inc. contains risk for the Boise memory-chip maker and will require a lot of work to succeed, an analyst said Tuesday.
Several key components make the Micron-Elpida deal appear to be a smart move, but integration could prove challenging or even messy if details are not worked out carefully enough, said Mike Howard, an analyst in Boise for IHS iSuppli, a research company.
Microns previous acquisitions in years past of specialty memory makers Numonyx and Inotera presented unanticipated surprises, and in some ways Micron is still digesting those purchases, Howard said. Adding Elpida to the mix is unlikely to hasten the rest of the complicated integration process that Micron still needs to do with its earlier buyouts.
Micron, the largest U.S. maker of computer memory, said July 2 that it will buy Elpida for $2.5 billion. The agreement is subject to approval by a Japanese court, which Elpida has said it will seek in August. Creditors must also approve the agreement. The companies plan to complete the sale in the first half of 2013.
The acquisition is likely to boost Microns production of dynamic random access memory, the most common type of memory in personal computers, by about 130 percent, making it the No. 2 DRAM producer behind Koreas Samsung Electronics.