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Western Digital to invest ¥500B in Toshiba JV

Western Digital Corp. is investing about ?500 billion in a memory chip joint venture with Toshiba Corp. over the next three years, The Nikkei reported.

The investment will reportedly help fund the construction of a production building at Toshiba's Yokkaichi plant in Japan's Mie Prefecture, which houses the Japanese conglomerate's joint chipmaking business with Western Digital. The center will employ about 2,000 engineers from the two companies, with Toshiba Memory Corp. planning to hire about 500 technicians knowledgeable in semiconductors over the next two to three years.

The amount will also be used for a plant in Kitakami, situated in Iwate Prefecture, which is expected to open in 2020, according to the report. Western Digital and Toshiba have agreed to evenly split capital spending, excluding the cost of buildings and the like.

The projects will allow the companies to steadily increase the joint production of 3-D flash memory chips in response to the growing demand for high-capacity memory. The two parties are working to revive their joint operations, which took a hit from last year's legal battle between the two companies, the report said.

Meanwhile, Toshiba is expecting to complete the sale of its memory chip business to a consortium led by private equity firm Bain Capital LP by June at the latest, if not by its agreed deadline at the end of March. "I believe approval will come sometime in April, May or June," Toshiba Memory President Yasuo Naruke said.

As of March 9, US$1 was equivalent to ¥106.93.