Based on the assets Intel Corp. brought to the table, it makes sense that STMicroelectronics walked away with a greater stake in their joint venture for flash memory production, according to an analyst.
"When you take a look at what each side is contributing then you understand why ST is getting a larger stake," said Gregory Wong, a flash analyst at Web-Feet Research. "ST is contributing an 8-inch fab, 12-inch fab and an equity stake in a 12-inch fab. Intel is contributing two backend facilities, plus 8-inch wafer fab equipment."
Even though Intel had larger revenues, ST managed to pocket 8 percent more than Intel in stock and cash compensation in the deal, according to a recent research note from Objective Analysis.
ST's NAND and NOR revenues added up to $1.57 billion last year, while Intel pulled in about $2 billion in NOR sales. But Intel gets a 45.1 percent equity ownership stake in the new company and $432 million. STMicroelectronics is due to receive a 48.6 percent equity stake and $468 million.