Chinese regulators launch probe into Samsung Electronics, SK Hynix, Micron

SEOUL (Reuters) – China has launched an investigation into South Korea’s Samsung Electronics Co Ltd and SK Hynix Inc as well as U.S. Micron Technology Inc.

FILE PHOTO: Memory chip parts of U.S. memory chip maker MicronTechnology are pictured at their booth at an industrial fair in Frankfurt, Germany, July 14, 2015. REUTERS/Kai Pfaffenbach/File Photo

A source with knowledge of the matter said China was probing price-fixing allegations as DRAM prices had risen sharply, the first such investigation by China.

“The investigation has kicked off in earnest,” the source said, requesting anonymity due to the sensitivity of the matter.

FILE PHOTO: SK Hynix Inc’s DRAM modules are seen in this picture illustration taken at the company’s main office building in Seoul October 24, 2012. REUTERS/Kim Hong-Ji/File Photo

All three companies confirmed that officials from China’s State Administration for Market Regulation had visited their offices.

FILE PHOTO: A man displays a DRAM chip inside a computer mall in Taipei February 16, 2009. REUTERS/Nicky Loh/File Photo

A Samsung spokesman said the company was cooperating with the Chinese authorities, but did not provide more details on the visit. A SK Hynix spokesman also declined to give further details.

The three companies are the biggest suppliers of DRAM chips used in smartphones and personal computers to store data.

“China (is) trying to protect their PC and smartphone market from rising DRAM costs. Typically, China PC and smart phones sell at lower costs/margins than those in other countries,” Stifel Nicolaus analyst Kevin Cassidy said.

The investigation also comes at a time when China is looking to promote its own chip industry to cut its heavy reliance on imports.

Chinese firms have also had a number of overseas deals to buy foreign chip companies blocked by U.S. regulators in recent years, including a bid by Tsinghua Unigroup to acquire U.S. chip group Micron Technology Inc.

Reporting by Ju-min Park in Seoul; Additional reporting by Supantha Mukherjee and Laharee Chatterjee in Bengaluru; Editing by Edwina Gibbs