Western Digital has abruptly walked out of merger talks with Kioxia, shattering Bain Capital’s ambitions to create a US-Japan memory-chip champion, according to three people with direct knowledge of the talks.
The collapse in negotiations come after South Korean chipmaker SK Hynix, which has a significant stake in Kioxia, declared its opposition to the deal amid concerns that the combined entity could challenge its position in the Nand memory sector. Analysts said the merged entity’s market share would be double that of SK Hynix.
The merger talks had received substantial behind-the-scenes support from the US and Japanese governments. The move was viewed by both as a means of solidifying co-operation on semiconductor supply chains, said people with direct knowledge of the situation.