With DRAM spot and contract prices both down, memory maker Nanya Technology saw its stock price fall to NT$15.30 (US$0.506) on November 16, below the NT$16.50 new share offering price. Despite the latest development, Nanya Technology's parent company Formosa Plastic Group and affiliates Formosa Petrochemical, Nanya Plastic and Formosa Chemical and Fabre have thrown their full support behind the fund raiser and have placed orders for new shares, which should allow the DRAM company to raise NT$9.9 billion.
At the moment, the entire Formosa Plastic Group controls a more than 60% stake in Nanya Technology, and Nanya Plastic has placed orders for NT$6 billion worth of new shares.
Early November contract prices for 1Gb DRAM memory have plunged by over 7%, driving the price of 2GB DDR3 modules to US$24-25. Suppliers will see further price falls through the second half of December, but expect any declines to be more moderate.
The continued fall in DRAM prices reflects the fact that demand is too slow to keep up with chipmakers' output growth using advanced processes. The mainstream memory density for PCs still remains at 2GB, limiting overall DRAM consumption.