Failed Japanese chipmaker Elpida Memory, which has agreed to be bought by US rival Micron Technology Inc, said on Tuesday it had submitted a restructuring plan to the Tokyo District Court, the next step in efforts to ensure the survival of some of its operations. Micron agreed in early July to buy Elpida for about $750 million in cash and pay creditors a total of $1.75 billion in annual instalments through 2019. A group of Elpida bondholders said Micron is offering too little for the chipmaker. Elpida did not elaborate the content of the plan. The group, which says it holds about $1.2 billion in Elpida bonds, submitted a plan to the Tokyo court last week that values the chipmaker at more than 300 billion yen ($3.78 billion), well above Micron’s offer. The bondholders did not put forward an equity investor, although it offered to lend Elpida 30 billion yen to help the chipmaker restructure. The court may endorse one of the plans, or even both, after which all of Elpida’s creditors will get to vote. A rejection of Micron’s offer by the creditors could lead to the liquidation of Japan’s last remaining player in the dynamic random access memory (DRAM) chip market. But lawyers outside the deal say this is only a slim possibility because the court would most likely allow creditors to look for another equity investor. The group of bondholders so far has not been able to find an equity investor, which may persuade other creditors to support Micron’s cash offer. “It would be difficult for creditors to vote against the plan submitted by Elpida’s court-led administrator unless there would be a new sponsor already being secured,” said Makoto Tahira, a Tokyo-based lawyer specializing in corporate rehabilitation. “Without a sponsor, Elpida could be liquidated and creditors should not want this to happen,” he said. The group of bondholders, consisting of about 20 institutions including hedge funds, said it was in talks with more than one company to make a cash injection into the chipmaker. Elpida filed for bankruptcy in February with about 448 billion yen ($5.6 billion) in liabilities. The company was hurt by low prices for DRAM chips and a growing preference for tablets that dampened demand for memory chips used in personal computers. It also faced growing costs to implement new technologies, which have helped drive consolidation in the highly competitive and cyclical sector. Micron’s purchase of Elpida, an Apple supplier that makes chips for smartphones, tablets and computers, would push the US company into second place behind market leader Samsung Electronics in the global market for Dram chips. Micron, which also makes Nand flash memory chips, has also committed as much as 64 billion yen to fund Elpida’s capital investments, as well as a guarantee of 16 billion yen in loans for Elpida, according to a document distributed to investors in July and seen by Reuters. Elpida needs a partner that could help it diversify its revenue streams, said Akira Minamikawa, a Tokyo-based principal analyst at US research firm IHS iSuppli. “Elpida in the end could not survive just with Dram technology. Without a strong Nand business, I don’t think it holds that much value.” Elpida Memory, the bankrupt Japanese chipmaker being bought by Micron (MU) Technology, will get 280 billion yen ($3.5 billion) in support from the US company. Micron will buy Elpida shares for 60 billion yen to make it wholly owned in the first half of 2013, according to a revival plan to be submitted in Tokyo District Court today, the Asahi reported without saying where it got the information. Micron, a Boise, Idaho-based maker of computer memory, will provide 80 billion yen in loans and debt guarantees and help Elpida generate 140 billion yen in profit by buying its chips during a seven-year period, the report said. The revival plan is critical for Elpida President Yukio Sakamoto, one of the court-appointed trustees, to convince bondholders Micron can turn around his company. Combining with Elpida would double Micron’s share of the global market for dynamic random access memory — the most widely used memory chips in personal computers — and help it compete with market leader Samsung Electronics Micron agreed last month to buy Elpida for 200 billion yen, though creditors told the court they believe Elpida is worth 300 billion yen. From gulftoday