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What happened: SK Hynix (SKHY) stock jumped 3% in pre-market trading on Wednesday following a report that the memory maker is exploring a deal with Intel (INTC).
Rivals Micron (MU) and Samsung Electronics (005930.KS) also rose modestly. The broader chip complex, including Nvidia (NVDA), AMD (AMD), Sandisk (SNDK), and Western Digital (WDC), edged higher.
What’s behind the move: The South Korean memory maker responded to a Reuters report that it is in talks with Intel about an agreement to manufacture memory silicon wafers in the US for the first time.
SK Hynix said it is “exploring various options to strengthen its global competitiveness, but no specific plans or arrangements have been finalized at this time.
“No decisions have been made regarding the two scenarios mentioned in the article,” said the company statement released on Wednesday.
What else you need to know: The media report, citing three people familiar with the discussions, claimed that as part of the deal, SK Hynix could lease part of Intel’s Ohio facility, which has been in the works for years.
Another scenario mentioned was the establishment of a joint venture among SK Hynix, Intel, and major cloud companies.
The report also flagged possible opposition from Seoul as a major hurdle.
The US has been pushing to onshore advanced semiconductor manufacturing. The goal is to reduce reliance on foreign supply chains, which currently come primarily from Taiwan and South Korea.
Currently, Micron (MU) is the only one of the world’s largest memory makers that makes its silicon wafers in the US. Its rivals SK Hynix and Samsung Electronics have invested in the US in areas such as packaging, R&D, and processors.
Ines Ferre is a Senior Business Reporter for Yahoo Finance covering the US stock market, publicly traded companies, and commodities.
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