JAPANESE MEMORY MAKER Elpida said it is uncertain whether it can pay its debts in April, which could leave it bankrupt.
Elpida's recent troubles have been well documented and the firm has been trying to find a buyer, but yesterday the company revealed it is uncertain about its survival. This disturbing news is due to lack of funds to pay its debt, some of which is coming due in April.
Following Elpida's announcement its share price fell off a cliff, falling 21 per cent soon after markets opened in Tokyo.
The company has been unable to put together a deal with the Japanese trade ministry, which Elpida hoped to help it raise $1.2bn in financing by April, but worse news is that the firm owes nearly $3bn more on top of that.
Elpida could still pull a rabbit out of its hat and be bought by another DRAM manufacturer. Micron has been mentioned as a possible white knight, though the proud Japanese firm is unlikely to savour being bought up by a foreign rival.
Last week Micron said it believes DRAM prices have bottomed out. Whether or not this is true or just a ploy to get its customers to buy now, it looks increasingly like the DRAM recession might be about to claim its biggest victim to date.
Given that Elpida has admitted it is in dire straits, perhaps it will have to put pride to one side and think of survival. µ