Intel collaborates with Micron to form new venture

Intel has announced that they are entering into a partnership with Micron Technology to form a new venture. This new entity would be manufacturing flash memory, which has become so popular with the growing usage of mobile phones, digital cameras and of course the iPods and other music players. This firm has already gone into a partnership with Apple to ensure a constant supply of flash memory to the Macintosh maker for their iPods till 2010.

Apple is also due to pay Intel and Micron USD 250 million each for this constant supply of flash memory promise. For their new venture, both the parties would be contributing about $1.2 billion in cash, notes, and other assets to form the company. The new entity would be known as IM Flash Technologies LLC. There are further plans to invest an additional $1.4 billion from both the companies over the next three years.

Interestingly, Micron would be holding a majority 51% stake in this new venture and as a result would be consolidating financial results on its balance sheet. IM Flash Technologies would be manufacturing NAND flash memory, which is very high in demand in the market right now. Market analysts predict a growing demand for this kind of memory in the coming months as well.

The new entity is expected to start its manufacturing of these memory modules by early 2006 at the various installations of Micron.