Intel announced this evening that it has closed the first phase of the sale of its SSD and NAND businesses to SK hynix and has now received the initial $7 billion tranche to seal the deal. The news comes on the heels of SK hynix's announcement last week that the acquisition had cleared the final regulatory hurdles in China, albeit with certain restrictions. SK hynix also announced that it had formed a new 'Solidigm' subsidiary to operate the fab and handle the SSD business. Intel veteran Rob Crooke, previously the SVP and GM of Intel's Non-Volatile Memory Solutions Group, will helm the San Jose-based Solidigm as CEO.
The total sale includes Intel's SSD business, NAND IP, and wafer production, all for a total of $9 billion — but it comes in the form of two steps. The first step of the sale, completed today, includes transferring Intel's Dalian fab in China, some employees, and certain IP pertaining to NAND-based SSDs to SK hynix.
The final step of the sale won't arrive until March 2025. In the meantime, Intel will still manufacture NAND wafers at the Dalian facility and will retain some of its NAND wafer design and manufacturing IP. However, when the final step completes in 2025, Intel will transfer its remaining employees in its R&D department and the last of its NAND design and manufacturing IP to SK hynix. At this point, Intel will also stop manufacturing NAND in the Dalian fab.
Rob Crooke, the long-time SVP and GM of Intel's SSD operations, will take over as the CEO of a newly-formed and wholly SK hynix-owned subsidiary named 'Solidigm,' a name said to "reflect a new paradigm in solid-state storage." The company will be headquartered in San Jose, California. Lee Seok-hee, president and co-CEO of SK hynix, will serve as the company's executive chairman.
The company will be subject to some lingering restrictions from Chinese regulators, including pricing limits for finished products and components and supply expansion assurances for enterprise-class PCIe and SATA components for five years, among other restrictions. All of Intel's existing SSD storage products will now be manufactured and sold under the Solidigm banner.
"Solidigm is poised to be the world's next big semiconductor company, which presents an unprecedented opportunity to reinvent the data memory and storage industry," said Crooke. "We are steadfast in our commitment to lead the data industry in a way that can truly fuel human advancement."
The deal allows Intel to focus more closely on its other businesses as it exits the low-profit and capital-intensive flash memory business that's subject to extreme pricing volatility. Intel will retain its 3D XPoint technology that powers its Optane products. Still, the future of that tech is unclear after its manufacturing partner Micron recently sold its fab and ceased 3D XPoint production. Intel is also planning to take Mobileye, its company focused on self-driving car technology, public via an IPO next year. However, Intel plans to be the majority owner of the public company.