New joint venture partner for KTI Semiconductor:
Kobe Steel, Micron to partner
TOKYO (June 19, 1998) -- Kobe Steel, Ltd., Texas Instruments Incorporated and Micron Technology, Inc. have entered into an agreement whereby Micron Technology, Inc. will acquire the 25% equity share in the joint venture KTI Semiconductor, Ltd. currently held by Texas Instruments. Kobe Steel will maintain its 75% share in KTI. Final agreement is pending after the details are worked out.
The new arrangement, which will enable KTI to rebuild itself, calls for the joint venture to manufacture memory semiconductors using Micron's advanced process technology. Established in 1990, KTI is a state-of-the-art, high productivity wafer fabrication facility located in Nishiwaki in western Japan which manufactures 16-megabit and 64-megabit DRAMs.
Due to the oversupply of memory chips in world markets and sharp decreases in DRAM prices, KTI's financial performance has been in a slump since 1996. In the latter half of 1997, Kobe and TI began discussions on rebuilding KTI. In the interim, TI started to consider transferring its memory business to Micron, a rapidly growing company in the same field. The agreement reached includes plans for Micron to acquire TI's equity share of KTI. The completion of the Kobe-Micron agreement is contingent upon closure of the TI-Micron transaction.
"Micron has some of the world's most advanced design and process technologies. Its product performance and cost competitiveness are among the best in the industry. We are looking forward to improving KTI's competitive position by combining its advanced production technology, high level of plant management and outstanding human resources with Micron's advanced process technology," said Masumi Sato, Executive Vice President at Kobe Steel.
"KTI should also benefit from the new arrangement by major changes in the contract with Micron, which should enable it to quickly improve its business performance. These factors should improve KTI's results of operations in fiscal 1999 and in the future," he said.
Steven Appleton, Chairman, CEO and President of Micron added: "Micron's equity participation in KTI will enable us to gain a production facility in Japan, one of the world's largest semiconductor markets. It will further reinforce Micron's position as one of the world's leading producers of memory semiconductors."
About KTI
KTI Semiconductor, Ltd. is a joint venture company 75% owned by Kobe Steel, Ltd. and 25% by Texas Instruments Incorporated. Established in May 1990, KTI makes primarily 16-megabit DRAMs. Based in Nishiwaki, Hyogo Prefecture, the company is capitalized at 42.1 billion yen (which includes additional paid-in capital). KTI is headed by President Izuo Takahashi and employs about 800 people.About Micron
Micron Technology, Inc. and its subsidiaries manufacture and market DRAMs, very fast SRAMs, Flash, other semiconductor components, memory modules, personal computer systems, and remote intelligent communications (RIC) products. Headquartered in Boise, Idaho (USA), Micron had sales of $3.5 billion in 1997 and 12,200 employees. The company is headed by Chairman, CEO & President Steven R. Appleton.About Texas Instruments
Texas Instruments Incorporated is a global semiconductor company and the world's leading designer and supplier of digital signal processing solutions, the engines driving the digitization of electronics. Headquartered in Dallas, Texas (USA), the company's businesses also include materials and controls, educational and productivity solutions, and digital imaging. The company has manufactur- ing or sales operations in more than 25 countries. In 1997, TI had sales of $9.8 billion and 44,000 employees worldwide. TI is headed by Chairman, CEO & President Thomas J. Engibous. The company was founded in 1930.# # #
Media contact:
Gary I. Tsuchida
Tokyo, Japan
tel (03) 3218-6055
fax (03) 5252-7961
e-mail www-admin@kobelco.co.jp
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