Samsung Electronics Co Ltd said on Monday it may sell NAND flash memory chips to Japanese electronics maker Sony Corp and others, underpinning expectations for surging demand for the chips.
Samsung shares rose to an all-time high as investors expected these contracts to strengthen the company's hold on more than half the world's NAND chip market.
For Sony, the possible deal comes as the world's second-largest consumer electronics maker strives to play catch-up with rivals such as Apple Computer Inc in the portable music market.
NAND memory chips are widely used in music players, digital cameras and mobile phones because they retain data even when the power is shut off. "Samsung Electronics is considering signing contracts to supply NAND flash chips to major companies, including Sony, but nothing in detail has been decided," the South Korean firm said in a statement to the Korea Exchange.
The statement came in response to a Korea Economic Daily report that quoted an unnamed senior official at Samsung as saying Sony had offered to use Samsung's NAND flash chips for its MP3 players to be unveiled next year.
The newspaper also quoted the official as saying both companies would probably sign a contract in the first half of next year, adding the contract would exceed Samsung's sales contract with Apple. The newspaper did not provide a value.
Samsung, which is battling Japanese rival Toshiba Corp in the NAND flash memory chip market, has been holding down prices to woo more electronics makers to use its chips. Samsung, the world's top memory-chip maker, started selling its flash chips in the second half of this year to Apple Computer, the maker of iPod music players.
Explosive demand for NAND chips has been behind a recent rally in Samsung's share price, along with signs of a rebound in prices of mainstay dynamic random access memory (DRAM) chips.
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