Elpida Memory and Mitsubishi Electric have reached the basic agreement to start discussing the integration of Mitsubishi Electric's DRAM operations with Elpida. The agreement is expected to be reached by the end of this year, with the goal of integrating the DRAM business by April 2003. In addition, this agreement will allow Elpida Memory to form a new alliance with Powerchip Semiconductor. Powerchip would serve as a foundry for Elpida's DRAM production.

Elpida Memory is a joint venture launched by NEC and Hitachi in 1999,
specialising in DRAM. Upon completion of this agreement, Elpida will be the
only major DRAM supplier in Japan. The company expects to be able to move
its market position from No.5 to No.4.
As part of the agreement, Elpida will gain the right to acquire all of
Mitsubishi Electric's standard DRAM devices and modules that are currently
produced on Mitsubishi Electric's 0.15micron and smaller process
technologies. Elpida will provide its DRAM process technology to Powerchip,
and in turn, Powerchip will produce DRAMs using this technology.
Initially Powerchip will continue to use the 0.13/0.12micron process
technology provided by Mitsubishi Electric as part of the integration
agreement. Powerchip will be able to obtain what is claimed as the
world's-first 0.11micron processing technology being developed by Elpida.
Mitsubishi Electric will also commission Powerchip to be its foundry for
System LSI products.
Elpida's new 300mm wafer production facility in Hiroshima, Japan, is on
schedule to begin volume DRAM product in January 2003. The company began
initial 300mm manufacturing last week.