Kingston Technology, a leading manufacturer of memory modules, solid-state drives and other memory products, recently increased its stake in Phison, an independent designer of NAND flash controllers. The investment will help Phison to fund development of SSD controllers better suited for Kingston.
Kingston will acquire 10.4 million shares of Phison for $57 million, or NT$180 per share, reports DigiTimes web-site. Kingston is already a strategic partner of Phison. The amount of issued shares of Phison is around 185.5 million, which means that Kingston bought about 5.6 per cent stake in Phison. The cumulative stake that Kingston holds in Kingston is unknown.
While companies never disclose purposes of additional investments, it is highly likely that Kingston wants to strengthen Phison’s abilities to develop competitive NAND flash controllers, primarily those that are used for solid-state drives.
Phison designs and sells various NAND flash controllers for applications like USB drives, SD cards, eMMC, SSDs and other.
The two companies own a joint venture, called Kingston Solutions (KSI), which is specialized in the sales and marketing of embedded memory products. Toshiba Corp. is an investor of KSI as well.
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KitGuru Says: Kingston’s investments in Phison seems to be yet another example of consolidation in the SSD industry. Large SSD and NAND flash makers tend to develop their own controllers. Therefore, to differentiate and keep its SSDs competitive, Kingston needs to ensure stable supply of advanced controllers at moderate prices.