Western Digital May Acquire Kioxia

The Wall Street Journal reported on Aug. 26 that Western Digital would acquire Kioxia for US$20 billion and the deal is likely to be concluded next month.

Rumors about the merger began to circulate in March this year. At present, the global NAND market is being led by Samsung Electronics, whose share in the market is 33.4 percent, and it is being followed by Kioxia (18.4 percent), Western Digital (14.2 percent), SK Hynix (12.2 percent), Micron Technology (11.9 percent) and Intel (7.4 percent).

SK Hynix acquired Intel’s NAND business unit for 10.3 trillion won last year. The acquisition is scheduled to be completed at the end of this year, and then the market share of SK Hynix can rise to 19.6 percent.

Once Western Digital acquires Kioxia, the global NAND market will be led by Samsung Electronics, Western Digital and SK Hynix and the runner-up will be able to narrow its market share gap with Samsung Electronics to 0.8 percent or so.

The Wall Street Journal pointed out that it is still not sure whether the deal will be actually concluded in that the market value of Western Digital is estimated at US$19 billion and Kioxia may go public as previously announced or choose another partner for its merger. Another variable is that the merger requires approvals in Japan and China. Kioxia is currently the only major semiconductor company in Japan and the Japanese government may not approve the deal. In addition, the Chinese government may put a brake on the United States’ attempt to rise in the semiconductor industry.