The shareholders of struggling chip maker Elpida Memory Inc. have approved a private share flotation that will count as a de facto injection of public funds, the company said after a special meeting Saturday.
Elpida, the world's third-largest and Japan's sole maker of dynamic random access memory chips, will issue ¥30 billion worth of preferred shares, which carry no voting rights, for purchase by the Development Bank of Japan.
The state-owned bank is scheduled to make payment on Monday, Tokyo-based Elpida said. Some 80 percent of the payment is guaranteed by the government.
In June, the government decided to make Elpida the first company to receive public funds under an emergency financial aid program it launched to help nonfinancial companies decimated by the global economic downturn.
Elpida Memory told the assembly that the money will be spent on technology development and investment in equipment, sources familiar with the meeting said. The assembly drew 225 shareholders and lasted only 27 minutes.
Elpida is expected to introduce the latest equipment for producing DRAM chips for cell phones and digital TV sets at its Hiroshima factory.
The company incurred a group net loss of ¥44.45 billion in the April-June quarter and is also seeking aid from Taiwanese technology partner Taiwan Memory Co., a memory chip company set up by the Taiwanese government.