MUNICH, Germany -- Kingston Technology Company Inc., a supplier of add-in memory cards and memory modules for computers and other equipment, has signed a long-term supply agreement for DRAMs with European chipmaker Infineon Technologies AG that could be worth up to $2.5 billion over the next five years, the companies said.
The two companies stated they are expanding their existing business and that in addition to the long-term agreement (LTA), the companies have agreed that Kingston shall provide contract manufacturing and 'back-end' engineering services to Infineon.
The companies did not provide details of the circumstances that would see cumulative sales reach $2.5 billion; or how much less than $2.5 billion sales could reach under other circumstances.
"The expanded relationship with Kingston enhances our ability to build market share, gain increased production flexibility to meet the requirements of key customers, and control our direct investment in back-end manufacturing capability," said Harald Eggers, memory products group chief executive at Infineon, in a statement.
"High production yields at competitive cost is the key to continued success for DRAM suppliers, and Infineon's commanding lead in 300-mm production technology and constant innovation in process technology assures competitive cost position and the ability to meet volume commitments," said David Sun, co-founder of Kingston.
Kingston designs, assembles, and tests memory modules in regional manufacturing facilities in China, Malaysia, Taiwan, and the Unites States.
It is planned that Kingston will provide engineering services to Infineon in the form of component and module validation at its subsidiary Advanced Validation Labs. The Labs can support OEM tests for the acceptance of die shrinks and module designs, Infineon said.