European regulators cleared SK Hynix Inc.’s $9 billion acquisition of Intel Corp.’s Nand storage unit, taking another step toward sealing a deal to strengthen the Asian chipmaker’s position in the booming memory market.
The European Commission has granted approval for the acquisition, the regulator said in a statement Friday. Hynix had earlier secured a greenlight from U.S. regulators and awaits approval from the U.K. and China. Icheon, South Korea-based Hynix, which announced the dealin October, is trying to win approval from the remaining countries this year.
The clearance comes as the Biden administration is reviewing semiconductor supply chains in the wake of a global chip shortage. If Hynix succeeds in getting signoffs from the remaining governments, it will cement its position as the largest Nand producer after Samsung Electronics Co. Meanwhile, Intel gains funds to invest in its faster-growing logic businesses.
Hynix will pay $7 billion in the deal’s first phase and the rest by March 2025. It is set to take over Intel’s facility in Dalian, China, by the end of 2021, boosting its market share of flash memory components used in computers and other devices to more than 20%. As of the fourth quarter of 2020, Hynix’s Nand market share was 11.6%, while Intel’s was 8.6%. Samsung dominates with 32.9% of the market, according to research firm TrendForce.
Hynix plans to more than triple its flash-memory revenue over five years through the acquisition, Chief Executive Officer Lee Seok-hee said in November.
“The proposed acquisition will help SK Hynix expand its global footprint, adding complementary memory technology,” the company said in a statement. “SK Hynix expects to enhance its expertise through the acquisition.”