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Elpida Shares Rise After Report on Merger Talks: Tokyo Mover

Elpida Memory Inc. (6665), the Japanese chipmaker facing an April deadline to repay debts, rose for a sixth day in Tokyo after the Yomiuri said it’s in merger talks with Micron Technology Inc. (MU) and Nanya Technology Corp. (2408)

Elpida climbed as much as 6.3 percent to 373 yen and traded at 362 yen as of 10:27 a.m. on the Tokyo Stock Exchange, headed for the longest streak of gains since November 2010. Japan’s benchmark Nikkei 225 Stock Average added 0.2 percent.

The Tokyo-based chipmaker needs about 92 billion yen ($1.2 billion) to repay loans and bonds by April, the Yomiuri reported, without saying where it got the information. Elpida may ask the Innovation Network Corp., a government-affiliated technology fund, to invest 100 billion yen as the company needs to buy equipment to improve its chips, the report said.

“The report boosts optimism that the company can come through this trouble,” Mitsuo Shimizu, an equity analyst at Cosmo Securities Co. in Tokyo, said by phone. “It can probably secure enough funds from banks and the government.”

Elpida said in a statement that the Yomiuri report “isn’t factual” and that it declined to comment on rumors and speculation.

Dan Francisco, a spokesman for Boise, Idaho-based Micron, also declined to comment. Calls to Taoyuan, Taiwan-based Nanya went unanswered today, which is a public holiday on the island.

Falling Chip Prices

Falling prices of dynamic random access memory chips used in personal computers and a stronger yen led Elpida to post a fourth consecutive quarterly loss in the three months ended Sept. 30. Elpida is the world’s third-largest chipmaker after Samsung Electronics Corp. and Hynix Semiconductor Inc.

Elpida is open to tie-ups with Nanya and Inotera Memories Inc., and the company had considered buying stakes in Taiwanese chipmakers including Powerchip Technology Corp. and ProMos Technologies Inc., Yukio Sakamoto, chief executive officer of Elpida, said in an interview in October 2010. In February 2011, he said the Japanese company had dropped plans to merge with Taiwanese chipmakers.

Inotera is a venture between Micron and Nanya.

To contact the reporter on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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