NEW YORK (AP) -- Texas Instruments Inc. has agreed to bid $172.5 million for a mothballed chip factory in Sandston, Va., belonging to Qimonda AG of Germany, which is under bankruptcy protection.
TI's offer will set a floor price in an auction for the factory, if approved by the Delaware court administering the bankruptcy process of Qimonda's U.S. subsidiary. Qimonda's lawyers filed the agreement with the court on Thursday.
Qimonda closed the factory earlier this year, laying off 1,500 workers.
The factory made memory chips, but Dallas-based TI said it would retool it to make analog chips, a TI specialty used in a wide variety of gadgets, including cell phones. It said the factory would likely be the first to use large 300 millimeter silicon wafers as the raw material for analog chips. Large wafers generally make for more efficient production at lower cost.
If another bidder ends up as the buyer after the auction, Qimonda will pay TI a breakup fee of $4.3 million, plus up to $750,000 in expense reimbursements.
Shares of Texas Instruments added 30 cents to $24.41 in afternoon trading Friday.
