Rambus and Samsung reach settlement agreement

Samsung will invest US$200 million in Rambus stock and pay around $700 million over the next five years

Samsung Electronics and Rambus on Tuesday announced they had settled outstanding claims over licensing, which should net Rambus more than US$700 million over the next five years.

As part of the settlement agreement, Samsung will make an initial payment to Rambus of US$200 million, and quarterly payments of about $25 million for the next five years. Samsung will additionally invest $200 million in Rambus stock.

Rambus is licensing existing memory technologies to Samsung for five years as part of the agreement, said Rambus executives on a Tuesday conference call to discuss the deal. Rambus develops technologies that enable high-speed memory architectures that it licenses to memory makers.

The licenses cover Rambus technologies used in existing Samsung semiconductor products including DRAM and flash products.

However, separate agreements may need to be signed by the companies to cover any new technology Rambus develops, said Sharon Holt, senior vice president of licensing and marketing at Rambus. But having the settlement agreement in place provides a backdrop for the companies to further cooperate with each other, she said.

Both the companies have also signed a memorandum of understanding to jointly develop memory technologies. The companies will initially focus on graphics and mobile memory solutions, and will review "a potential collaboration" on server and high-speed NAND flash memories, the companies said in a joint statement.

Bringing together Samsung's market share and Rambus' innovations in memory architectures "will make possible an exciting new generation of mobile, computing and consumer electronics products," said Harold Hughes, president and CEO of Rambus, in a statement.

Samsung and Rambus also said that they've agreed to end all litigation against each other.

The companies have been involved in long-running disputes over patent infringement as well as antitrust issues.

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