Saturday, December 29th 2007

Intel and STMicro Flash Venture Delayed by Cash Problems

The giant memory chip firms confirmed yesterday in separate statements that the planned partnership, dubbed Numonyx, has been pushed back to 28 March next year. The deal had been expected to be completed by the end of this year, but serious cash problems will put the deal on hold for a while. In May $1.55bn had been offered in debt financing for the new Geneva-based company. Lenders have now significantly reduced that figure, to $650m along with a further $100m in a revolving credit facility. Intel said: "We are in the process of renegotiating credit agreements, and clearly [the total] will be less. "The markets have changed significantly since we first announced the deal." The new venture could have annual revenue of up to $3.6bn and will create products for mobile devices such as MP3 players and digital cameras. Once the deal finally completes, Intel will take a 45.1% stake while STMicro will take 48.6%. Francisco Partners, a Silicon Valley-based private equity group, will invest $150m for a 6.3%.
Source: Hexus.net
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3 Comments on Intel and STMicro Flash Venture Delayed by Cash Problems

#1
Jess Stingray
Cash problems? Gimme a break, this is Intel we're talking about. The company that get's 31.5 billion dollars revenue.
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#2
btarunr
Editor & Senior Moderator
^Their being the richest doesn't imply that they can spend on everything. They're not Microsoft. They are far more rapidly involved in new ventures and projects than any other corporation on the planet. Lot of money goes into RnD. They fix caps on how much they can spend on each project and allocate their resources on a project-wise basis, much like IBM.
Posted on Reply
#3
OnBoard
Can I get 0,0000063% of the profit if I invest $150 in them ?) (that would be a $76,8 profit in a year if I counted correctly and same part of profit as that private equity group gets with just a tad bit more money :p)
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