TOKYO, July 17 - Reuters: Any merger of U.S. chipmaker Western Digital Corp and Japanese rival Kioxia Holdings should ensure critical operations are divided equally between the two countries, a senior member of Japan's ruling party told Reuters.
The comments from Akira Amari, an influential economy minister and former politician in the ruling Liberal Democratic Party LDP underscore Japan's despair https: www.reuters.com com technology japan seeks - peril-us - chip-hub - counter-china - 2021 - 08 - 17 to preserve the remnants of its semiconductor industry, an area where it once led the world but has since been eclipsed.
We shouldn't allow everything to be taken away from the United States, Amari said in an interview on Thursday.
If Kioxia ties up with an American company, in particular a foreign company at the very least it will be necessary to have equal bases of operations in both countries. Asked if he meant production facilities, Amari declined to comment, saying the issue is related to Japan's strategy.
Kioxia, previously known as Toshiba Memory Corp, and Western Digital are in advanced discussions over a possible $20 billion Billion stock merger amid intensifying global rivalries over semiconductors.
Amari said he thought the two companies joining hands was not a bad idea. A combined Kioxia-Western Digital would control a third of the NAND flash market, and it would put on par with the Samsung Electronics unit in South Korea.
It is important to have mass scale, said Amari, who leads the LDP Task Force on semiconductors. A larger scale allows more power in research and development and a quicker grasp of changes in client needs. Amari's answer is in line with the Japan's Trade Ministry. Sources from Ministry said it is ready to back https: www.reuters.org. Western Digital world exclusive tokyo - ready-back - western digital - kioxia-deal - if-key tech-stays - Japan : 2021 - 09 03 Western Digital's bid to merge with Kioxia provided control of cutting-edge technology stays in Japan.
Kioxia sold by Bain Capital in 2018 to a consortium led by Toshiba Corp for $18 billion, shelved plans for an initial public offering last year after U.S - China trade tensions slammed Huawei, one of Kioxia's biggest clients. Kioxia said that it's still considering an IPO.
Toshiba, which retains about 40.6% of Kioxia, is in talks with at least four global private equity firms about its strategic options. That is also a potential issue of concern for Japan's government, which sees the conglomerate as a strategic asset because it makes defence equipment and nuclear reactors.
Asked about the possibility that Toshiba may be taken private, an option which some shareholders are pressing to consider, Amari said Toshiba's stakeholders should first think about how the firm's management structure should look.