Over the past year, NAND prices have continued their steady fall. For the average consumer, this has meant cheaper and cheaper SSDs and the release of ever larger capacities. However, this has placed enormous strain on NAND producers to reduce prices while taking on ever more expensive R&D costs. This has led to some consolidation in the industry and it looks like Micron may be the latest target.
According to their latest SEC filing, Micron has set up a poison pill to stave off a hostile takeover. The poison pill would allow current shareholders to buy newly issued stock at a discount if any one entity buys over 4.99% of Micron stock. The fact that Micron is taking such measures suggests that a hostile or at least unwanted takeover is being attempted.
So far, rumours have pointed to the Chinese attempting to expand their NAND flash portfolio. China is eager for flash storage and this wouldn’t be the first time they’ve approached the like of Western Digital, SanDisk and even Micron, looking for a merger or acquisition. However, regulators had already killed the WD deal with a Chinese firm over security concerns and any new deal with an American firm would likely face the same result. China has also started recently acquired XMC, a smaller NAND player so they might not be looking for another firm just yet.
Right now there are only a few major NAND players left; SK Hynix, Micron/Intel, SanDisk/WD/Toshiba and Samsung. Given what we’ve seen in the past, I expect there will be more consolidation in the future as more and more pressure is placed on the weaker players.
