Elpida is one of the big memory makers that has felt the pressure from the tough competition and dropping RAM prices. Times are so bad at Elpida that it might go belly up soon, but it looks like it might become a part of Toshiba in the future.
The race for narrower gate lengths has been going on for some time, which has resulted in the smaller actors or those in an economical pinch to be left behind. Add to that an unstable world economy and surplus stock of of DRAM has caused priced to drop fast. All DRAM manufacturers have been forced to their knees – besides Samsung that is the largest and still can make money on DRAM.
Elpida is one of the companies that is in a pinch and had to borrow money from the Japanese government to stay afloat. According to the latest information it can’t pay back the 386 million dollar it borrowed. The company resources barely covers the loan and there is talk of trying to create another rescue action which we assume is some form of debt sanitation. But this will probably not be allowed and the Japenes government has other plans.
It is propagating for an integration of Elpida into Toshiba to enable Toshiba to make use of the company resources to further strengthen the Japanese semiconductor industry in the long run. Elpida is the only manufacturer of DRAM in Japan, while Toshiba makes up the NAND portion. Japan sees it as a great asset that it can continue to make DRAM in the country. A merger will help them compete with the Korean semiconductor industry, mainly Samsung but also American actors.
