The deal is expected to be finalized later in 2007, with the new yet-to-be-named company producing flash memory for consumer and industrial devices like cell phones, digital cameras, MP3 players, and computers.
Intel said it plans on selling all of its NOR (a type of flash memory) resources to the newly formed company, while STMicro will contribute its flash assets, including its NAND and NOR resources.
"The new company will be positioned to service customers with all of the elements necessary to deliver current and next-generation non-volatile memory technologies, while allowing STMicro to redefine its participation in flash memory," Carlo Bozotti, STMicro president and CEO, saif in a statement May 22.
Two years ago, both companies announced they would be combining resources to produce NOR flash memory for phones and other devices.
More recently, Intel entered into the hard drive market with new solid-state drives based on NAND flash memory.