MEMORY MAKER Elpida has filed for bankruptcy after failing to find a buyer or get a bailout from the Japanese government.
Elpida is the last Japanese DRAM maker and has been hit extremely hard by the DRAM price slump, which left the firm looking for an investor that would allow it to service a $5.5bn mountain of debt. The investment never came and today Elpida filed for bankruptcy with the Tokyo District Court.
Elpida's petition for reorganisation read as a recent history of the DRAM market. The firm said, "At the beginning of 2007, the price of DRAM started falling sharply and, combined by a significant decrease of demand for the products due to the global economic downturn begun in the fall 2008, such price further declined. In the fiscal year ended March 2009, we were forced to experience a significant deterioration in business results compared with the previous year."
According to Elpida, the strong Japanese Yen also contributed to its downfall, though there is little doubt that the slump in DRAM prices was the biggest contributor to the Elpida's woes.
Elpida said it will work under the supervision of the Tokyo District Court to restructure the firm. It is not known at this stage whether a rival DRAM manufacturer such as Micron or Samsung will step in, however Elpida's bankruptcy is likely to strengthen their positions as the number of DRAM manufacturers continues to dwindle. µ