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Oct. 19, 2020, 10:45 p.m. EDT

Intel reaches $9 billion deal to sell NAND unit to SK Hynix

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By Cara Lombardo and Dana Cimilluca

Intel Corp. has reached a deal to sell its flash-memory manufacturing business to South Korea’s SK Hynix Inc. for about $9 billion, in a move that would reorient the semiconductor giant away from an area of historical importance that has become increasingly challenged.

The Intel /zigman2/quotes/203649727/composite INTC 0.00% unit makes NAND flash memory products primarily used in devices such as hard drives, thumb drives and cameras. The U.S. chip maker has been weighing getting out of the business for some time, driven by sagging prices for flash memory.

Under the deal reported earlier Monday by The Wall Street Journal, SK Hynix /zigman2/quotes/206420319/delayed KR:000660 0.00% plans to buy most of Intel’s memory business, including the related memory manufacturing operations in Dalian, China, the companies said in a statement. Intel will keep its Optane line of memory products, an advanced type of storage used heavily in data centers.

The operations being acquired by SK Hynix generated about $2.8 billion in sales in the first six months of this year, the companies said. That represents the lion’s share of Intel’s overall memory sales, which totaled around $3 billion during that period.

The deal would make SK Hynix one of the world’s largest NAND memory makers. SK Hynix and Intel’s combined market share was more than 20% in the second quarter, according to Taiwan-based research firm TrendForce, trailing only South Korean giant Samsung Electronics Co. /zigman2/quotes/209800866/delayed KR:005930 +0.13% , which held over 30% of the market.

An expanded version of this report appears on WSJ.com.

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