It was reported yesterday that Micron Technology has agreed to purchase its competitor Elpida Memory for a total of around ¥200 billion (US$2.5 billion). After a bidding process and negotiations lasting several weeks, Micron – as predicted by industry experts – has signed a deal to become Elpida’s rehabilitation sponsor. The deal will give Micron a 24.8% share of the global DRAM market, as well as knowhow and operational infrastructure. Additionally, it will get control of Elpida’s patents.

Readers of this blog will have some idea of how Micron has chosen to manage its patent portfolio recently. Although it had previously criticised the actions of NPEs, the company sold around a fifth of its portfolio to Round Rock Research back in 2010. It later emerged that Round Rock had effectively been set up by Micron to act as an assertion and licensing vehicle.

Micron may now think there are benefits in repeating that strategy with some of Elpida’s patents. Assigning part of the Japanese company’s portfolio to one or more NPEs will give Micron the ability to maximise the value of its newly acquired assets while protecting itself from the threat of counter-assertions – an issue that Elpida became all too familiar with in its latter days.

Depending on the exact structuring of the acquisition, the likes of Round Rock and other NPEs may find themselves with a few extra patents in the months following finalisation of the deal, which is expected towards the end of August. Knowing what we do of Round Rock’s birth, we may even see a new licensing entity on the scene.

Sectors

IP management, Licensing, Patents, IP business