After Toshiba ended the unpleasant legal disputes caused by the sale of the storage chip business by the consortium led by Bain Capital, Toshiba and Western Digital plan to use the new generation of flash memory chips produced by their joint ventures to curb the declining market share.
Attsuy Koike, head of Western Digital’s Japan division, said in an interview, “The infusion of government funds can better ensure the stability of the joint venture. I hope that the Japanese government will provide more active support to protect the country’s semiconductor industry. , otherwise it is difficult to compete with other countries.
Last Friday, led by Bain Capital, members of the consortium including Apple and South Korean chip maker Hynix completed a $18 billion acquisition of Toshiba's storage. Toshiba Storage is the world's second largest NAND flash memory after Samsung. Chip suppliers.
According to the settlement agreement reached between West Digital and Toshiba last December, the joint ventures of the two companies will not be affected by the above transaction.
When the above transaction was put forward in September last year, two Japanese government-invested financial institutions - Japan Innovation Network Corporation and Japan Development Bank - decided to participate in the transaction as investors.
Their participation in the transaction aims to meet the requirements of the Japanese government that Toshiba storage must be controlled by Japanese institutions. Toshiba still holds a 40.2% stake in Toshiba, but Japan Innovation Network Corporation and Japan Development Bank did not disclose their investment amount.
Western Digital and Toshiba disputes - Western Digital said that the joint venture agreement gave it a veto over Toshiba’s right to sell its storage chip business. It has concerns about Hynix's involvement in the acquisition of Toshiba's memory chip business, which was resolved last December.
However, the financial crisis and legal disputes caused great losses to both parties. The market share of the two companies' NAND flash memory chips fell from 35% in 2016 to 31.7%, while Samsung’s market share increased from 36.1% to 38.7%.
Koike and industry analysts pointed out that whether Toshiba and Western Digital can mass-produce advanced type NAND chips called 96-layer 3D flash chips as planned by the end of this year will determine the winner in the new generation of flash memory chip market.
Toshiba and Samsung are adopting different strategies in producing a new generation of flash memory chips, and they are competing to prove which strategy is more suitable for volume production. Koike said, 'The two sides will win a victory by the end of this year.'
Although Bain Capital’s consortium led to concerns about transferring technology to Hynix, analysts pointed out that Toshiba may need to work with international competitors to fight against Samsung. Akira Minamikawa, an analyst at IHS Markit, a market research company, said, ' The possibility of transferring technology to Hynix exists, but for now, working with Hynix to fight against Samsung is a way to survive.