Certain bondholders of bankrupt Elpida Memory that represent unidentified international pension funds this week opposed acquisition of the failed dynamic random access memory (DRAM) maker by Micron Technology, claiming that the U.S.-based memory maker will get Elpida at a huge discount and will eventually be able to not pay certain parts of the sum.

Under the agreement Elpida and Micron signed early this month, the latter will pay creditors of the former ¥200 billion (approximately $2.5 billion) total consideration, of which ¥60 billion (~$750 million) are to be paid in cash at closing, whereas, another ¥140 billion (~$1.75 billion) will be paid in future annual installment payments through 2019 from cash flow generated from Micron’s payment for foundry services provided by Elpida, as a Micron subsidiary.

Certain creditors of Elpida claim that not only $2.5 billion is too low price for Elpida, considering the fact that they will only get about $750 million for the company's equity, whereas 24% share of Rexchip Semiconductor will be acquired by Micron for $334 million, but the annual installment payments are subject to certain conditions and may never be paid.

In a filing to a Tokyo district court on July 9, the bondholders, which did not disclose their identities, but said  they were multi-billion dollar international funds, said they would present an alternative proposal to counter Micron's offer, reports Reuters news-agency. The submission of an alternative plan, would require the approval of the court before it could be put to a vote by all of Elpida's creditors as well as collaboration of the group with other creditors of Elpida.

The counter proposal will be completed by October when a voting for the restructuring takes place, said the source, who declined to be identified because the information was confidential.

Tags: Elpida, Micron, DRAM, Business