Infineon confirms it will cut out Qimonda

GERMAN SEMI-CONDUCTOR outfit Infineon has confirmed that it is cutting back on its association with its DRAM subsidiary Qimonda.

At Infineon's Annual Meeting, boss Wolfgang Ziebart said that Qimonda will not be flogged off, but he intended to reduce the stake in memory chip maker to a minority interest.

It is not clear when Ziebart will flog the Qimonda shares, apparently he is waiting for developments in the memory market and on Qimonda's performance relative to the competition. In the back of his mind he is also pondering when Infineon really needs the cash. Without Qimonda, Infineon should achieve "at least stable revenues and earnings" he said.

But the news is a little strange as earlier this week Qimonda Chief Executive Kin Wah Loh was surprisingly upbeat about his outfit's figures. Wah Loh said that the market was growing 40 and 50 per cent this year thanks to Windows Vista's launch. He expected DRAM memory capacity output to grow between 55 and 65 per cent worldwide in 2007, with a 10 per cent increase in personal computer sales. Graphic chips will grow by 90 percent thanks to Nintendo and Sony releasing new games machines.

Infineon already floated a 14-percent stake in Qimonda on the New York Stock Exchange last year.

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