In response to reports that Choi Tae-won (崔泰源), chairman of South Korea's SK Group, had proposed building a semiconductor plant in Japan, Japan's Kioxia denied that it had discussed joint production. The reports said that Kioxia's production structure and contractual terms, as well as SK's overseas production strategy, were factors behind the situation.
It was reported in a media interview in August that Choi Tae-won (崔泰源), chairman of South Korea's SK Group, had said the company would consider building a joint venture plant for memory semiconductors anywhere in Japan provided electricity and industrial water could be secured. This month, a newspaper interview was reported to have mentioned joint production with Kioxia as “one option.” Kioxia's CEO, however, denied that the company had “discussed joint production with SK hynix,” saying that he did not know “why such a statement was made.” The reports have drawn attention to the possibility of establishing a plant in Japan.
The article cites Kioxia's circumstances as part of the background. Approximately 80% of Kioxia's production capacity is allocated to its joint venture with US-based SanDisk, and a contract restricting production for third parties is expected to remain in effect through 2034. In addition, SK hynix holds convertible bonds issued by an investment company that owns a 14.19% stake in Kioxia, allowing it to convert the bonds into the majority of the company's voting rights. The reports said that concerns had emerged that Kioxia's management independence could be undermined if the companies jointly operated a plant.
The rapid expansion in demand for AI memory is behind SK hynix's consideration of overseas production. Choi Tae-won (崔泰源) has indicated that there is currently a 20–30% shortfall in memory for data centers. Although investment in facilities in South Korea is continuing, reports say that production capacity is insufficient to meet growing demand, creating an incentive for overseas expansion.
These reports highlight a complex situation involving the debate over establishing a plant in Japan, Kioxia's production structure and contractual arrangements, and SK hynix's overseas strategy. Readers are watching for further reports on how the two companies' specific negotiations and plans for operations in Japan may develop.