SK hynix Inc, South Korea's key memory chip maker, said Thursday it has closed the first phase of the transaction to acquire Intel's NAND and solid-state drive (SSD) business, and will name the newly established subsidiary Solidigm.

The announcement came eight days after it received the merger clearance from China's State Administration for Market Regulation, the last remaining major regulatory hurdle for its $9 billion acquisition of Intel's SSD business and the Dalian NAND flash manufacturing facility in China.

For the completion of the first phase, SK hynix will pay Intel $7 billion in consideration, the company said. The deal is scheduled to be finalized around March 2025, when the South Korean memory chip maker will acquire from Intel the remaining NAND business assets for $2 billion.

By then, SK hynix will finish up the remaining process, such as acquiring Intel's "IP related to the manufacture and design of NAND flash wafers, R&D employees for NAND flash wafers, the Dalian facility workforce, and the other associated tangible and intangible assets," the company said.

The newly established US subsidiary will be headquartered in San Jose, California. Lee Seok-hee, president and co-CEO of SK hynix, will be appointed executive chairman of Solidigm, and Rob Crooke, former senior vice president of Intel, will be appointed CEO of Solidigm, the company said.

The name, Solidigm, reflects the company's "commitment to creating a new solid-state paradigm that provides unmatched customer service and revolutionizes the memory storage industry," the company said in a statement.

"SK hynix sees the opportunity to greatly enhance its NAND Flash business competitiveness to the level of its world-leading DRAM business, as SK hynix excels in mobile NAND flash while Solidigm shows industry-leading strengths in enterprise SSDs (eSSDs)," it added.

SK hynix is the world's second-largest DRAM maker, with a market share of 27.2 percent in the third quarter, behind the dominant player Samsung Electronics with 44 percent, according to analyst firm TrendForce.

In the NAND flash market, it took up 13.5 percent after Samsung's 34.5 percent and Japanese chipmaker Kioxia's 19.3 percent.

Combined with Intel's NAND business, which has a 5.9 percent market share, SK hynix will likely rise to become the world's No. 2 player in the segment. In the SSD segment, where Intel has a strong presence with 29.6 percent, SK hynix can take over Samsung with a combined market share of nearly 37 percent.

The acquisition is also expected to rebalance SK hynix's revenue portfolio, which is heavily dependent on DRAM. By sales, DRAM accounted for around 70 percent of the company's total revenue last year, while NAND accounted for 23 percent. (Yonhap)