Apple Makes a Large Order for DRAM Chips Crippling Samsung’s Market

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Apple Makes a Large Order for DRAM Chips Crippling Samsung’s Market

After Apple placed a significant order for DRAM Chips with struggling Korean company Elpida, Samsung’s stocks dropped significantly.

According to Taiwan’s DigiTimesan online trade news site, Samsung Electronics Co., Ltd. (LON:BC94) shares dropped more than 6 percent on Wednesday. This significant drop in stocks has caused the Electronics Company to lose $10 billion off its market value.

Amidst all this there are talks going on between U.S. based company Micron Technology, Inc. (NASDAQ:MU) and Elpida Memory Inc (TYO:6665). Elpida is still recouping after going through a bankruptcy. The bankruptcy caused by tough market competition and economics is being overseen by a Japanese court appointed trustee.

In addition, SK Hynix shares have fallen steeply as well.  SK Hynix who normally supplies DRAM Chips to Apple has seen their market shares close 9 percent lower than usual. This is the biggest drop for the DRAM Chip supplier in nine months. Observers have noted that it seems that Apple does not want SK Hynix and Samsung to monopolize the chip market.

With the huge order purchased by Apple, the concerns of other big micro chipmakers such as SK Hinx and Samsung might be valid. Even more so is the talk of a possible Micro Elpida merger. Such a merger poses a grave threat to other microchip suppliers and could cripple their business.

Despite all the talk of hefty purchases made by Apple to Elpida, a SK Hinx spokesperson said they are receiving more orders than usual from their customers. The company spokesperson did not comment on the fact concerning if Apple reduced orders with them.

Adding to Samsung’s worries is the cutback of offshore investors who are filing suite after the recent uncertainty of the Greek government remaining a part of theEuro Zone. With such uncertainties, arising coinciding with Apple’s recent purchase it has come at a bad time for the electronic giant in Japan.

Other companies are feeling the pinch of the recent shakeup with the Greek Government as well. The makers of Flat Screen TVs LG Display had seen a 4.5 percent decline in their stocks. Hyundai Motors has seen an almost four percent decrease in their stocks as well.

One has to wonder why Apple is causing such a shakeup in the Korean stock market. The issues are obvious with Samsung due to their long and tedious court battles over patents but when it comes to other companies, they have done business with such as SK Hynix certain questions do come into play. Though it is great that Apple helps with companies such as Elpidaone might question is this just a company trying to help another company out or is there more to the story then what the public knows about?

Mergers occur daily between all corporate companies wanting to acquire power and wealth. Is this the case with Elpida does Apple want a cut of the pie from the Micro Elpida Merger? What remains at stake for the Micro Chip industry with these latest developments?

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