Intel's first fab in China is officially transferred to SK hynix, according to the latest Chinese registry filings, which marks the end of the firm's NAND production business in the region.
Intel's Dalian Fab Now Handed Over to SK Hynix In Official Documents; Team Blue Avoids Troubles From Producing in China
For those unaware, Intel sold its NAND business to SK hynix back in 2020, in a deal worth $9 billion, and this included Intel's Dalian fab in China as well, which was the firm's major production asset in the region. And interestingly, after almost five years, the Dalian fab has now been transferred to SK hynix officially, as new documents have renamed it as "SK Hynix Semiconductor (Dalian) Co., Ltd", indicating that the South Korean giant has taken over operations completely.
This development sounds intriguing because the US administration recently restricted Intel's operations in the Dalian fab by revoking VEU licenses for the firm. This means exporting US equipment to China's facility would now require regulatory approval. However, since the Dalian fab had been transferred to SK hynix, the presence of Intel's name in the U.S. Commerce Department notice brought uncertainty around Intel's China operations; however, this has now been cleared up.
The Dalian fab is reportedly being operated under SK hynix's subsidiary Solidigm, and for the South Korean giant, taking up the facility could prove to be a massive burden moving ahead. The firm has a decent portion of NAND production in China, and given how the VEU licenses are now revoked, SK hynix would find it difficult to scale up operations, making it difficult for them to produce cutting-edge NAND technologies in China. So ultimately, Intel managed to get a decent price for the fab and avoided the latest restrictions.
It would be interesting to see how the situation pans out, considering that there is a 120-day period before the VEU is officially revoked, and it might be that SK hynix manages to find a solution to ensure that its China operations continue seamlessly.
News Source: MyDrivers
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