Intel Corp and Micron Technology Inc on Monday said they would form a new company to manufacture NAND flash memory for consumer electronics, removable data storage and handheld communications devices.
The new company, IM Flash Technologies LLC, will manufacture its products exclusively for Intel and Micron. Each company will contribute about $1.2 billion in cash, notes and other assets to form the company. Intel and Micron also plan to pay an additional $1.4 billion each into the company over the next three years.
Intel and Micron also said they would supply Apple Computer with a "significant portion" of their shares of IM Flash Technologies' NAND flash memory output. In return, Apple will prepay $250 million each to Intel and Micron, the companies said.
The announcement comes as Apple on Monday said it would prepay $1.25 billion in the next three months as part of a deal to stock flash memory components used in its iPod digital music and video players.