Intel announced tonight that it has completed the first phase of the sale of its SSD and NAND business to SK hynix and has now received the initial tranche of $ 7 billion to seal the deal. The news follows SK hynix’s announcement last week that the acquisition had removed the remaining regulatory hurdles in China, albeit with some restrictions. Intel also announced that SK hynix will form a new subsidiary “Solidigm” to operate the factories. Intel veteran Rob Crooke, previously senior vice president and general manager of Intel’s non-volatile memory solutions group, will lead San Jose-based Solidigm as CEO.
The total sale includes Intel’s SSD business, IP NAND, and wafer production, all for a total of $ 9 billion, but it comes in the form of two stages. The first stage of the sale, completed today, includes the transfer of Intel’s factory in Dalian, China, some employees, and some NAND-based SSD IPs. The last step will not happen until March 2025.
In the meantime, Intel will still manufacture NAND wafers at the Dalian factory and retain some of its intellectual property in designing and manufacturing NAND wafers. However, when the last stage is completed in 2025, Intel will transfer its remaining employees in its R&D department and the last of its NAND design and manufacture IPs to SK hynix. At this point, Intel will also stop manufacturing NAND at the Dalian plant.
After the close of the second phase, Intel’s Rob Crooke, the long-time SVP and general manager of the company’s SSD operations, will then take the helm of a newly formed subsidiary wholly owned by SK hynix, named “Solidigm,” indicated a name. to “reflect a new paradigm in solid state storage”. The company will be headquartered in San Jose, California. Lee Seok-hee, chairman and co-CEO of SK hynix, will be the company’s executive chairman.
The company will be subject to some persistent restrictions from Chinese regulators, including price limits for finished products and components, supply expansion guarantees for enterprise-class PCIe and SATA components for five years, between other restrictions.
“Solidigm is on its way to becoming the next major global semiconductor company, presenting an unprecedented opportunity to reinvent the memory and data storage industry,” said Crooke. “We are unwavering in our commitment to leading the data industry in a way that can truly fuel human advancement. “
The deal allows Intel to focus more closely on its other businesses as it exits the low-profit, capital-intensive flash memory industry which is subject to extreme price volatility. Intel will keep its 3D XPoint technology that powers its Optane products. Still, the future of this technology is unclear after its manufacturing partner Micron recently sold its plant and ceased production of 3D XPoint.