Chipmaker Elpida in tie-up talks with Taiwanese firms

Monday 27th December, 05:51 AM JST

TOKYO —

Major Japanese semiconductor maker Elpida Memory Inc is in talks with Powerchip Technology Corp and several other Taiwan semiconductor companies on business collaboration that could include mergers and tie-ups in equity capital, according to sources familiar with the matter.

Elpida is the world’s third-largest manufacturer of DRAM, or dynamic random access memory, chips. Economies of scale are believed to be essential in the DRAM chip market as competition is intensifying among manufacturers. If Elpida secures alliances with companies in Taiwan, it could rival South Korea’s Hynix Semiconductor Inc, the world’s second-largest manufacturer after Samsung Electronics Co of South Korea.

Elpida President Yukio Sakamoto could visit Taiwan in January to further negotiations, the sources said.

To reduce production costs, Elpida is hoping to produce DRAMs for PCs in Taiwan, while producing high-end chips such as those for smartphones at its factory in Hiroshima, the sources said.