Japan's Kyodo news agency reported that the merger talks between NAND memory maker Kaixia and Western Digital have entered the final stage of adjustment, with Kaixia taking the lead in the new combined company.

The combined company is expected to surpass Samsung as the world's largest NAND memory maker by revenue, the report said. The two companies are seeking a merger to improve operating efficiency as the market for storage products used in smartphones and other applications deteriorates and results are sluggish. The report cited people familiar with the matter as saying that the merger will be further negotiated on details such as the proportion of capital contribution under Kaixia's control.

According to Omdia, a research agency, Kaixia and Western Digital ranked third and fourth in terms of market share in 2022. The combined NAND memory is expected to generate 2.5 trillion yen (126.75 billion yuan) in revenue, surpassing Samsung Semiconductor, the industry leader.

IT Home has learned that Kai Xia was born in the "father of flash memory" Toshiba. Kaixia will invest 43 percent of the combined company, Western Digital 37 percent, and the remaining 20 percent will be owned by existing shareholders such as Toshiba Corp, Reuters reported, citing sources familiar with the matter. The combined company plans to list on the Tokyo Stock Exchange in the future.