MUNICH, Germany — If reports in the German media are proved correct, Chinese chip manufacturer CSMC is the mysterious suitor for the insolvent DRAM manufacturer. However, it seems highly unlikely that the Chinese company indeed is interested in taking over Qimonda's production.

After Max Kley, supervisory board chairman of Qimonda's parent company Infineon, had aired in an interview that his company was in negotiations with a Chinese investor over the sale of ailing Qimonda, the rumor mill in the German media ran wild. While Kley did not divulge the identity of the negotiation partner, the credibility of his story was backed by the fact that insolvency administrator Michael Jaffé flew to Hong Kong for negotiations with potential Asian investors.

Now the media claim they have identified the mysterious investor: It is said to be chip manufacturer CSMC of Wuxi, China. In a report, the respected magazine Wirtschaftswoche writes that Qimonda and CSMC have been in talks for several months. The paper adds that being a subsidiary of China Resources Microelectronics which in turn is a subsidiary of combine China Resources, CSMC could have the financial strength to take over Qimonda which end of January filed for insolvency. In its report, the paper refers to an anonymous industry insider.

But the Witschaftswoche report, which in the media here triggered a wave of secondary articles, referring to it and repeating the same statement, ignores some facts that might turn out to be essential. For instance, CSMC is not active in the DRAM business and hence has no experience whatsoever in this market. According to its web site, the company is a pure-play analog foundry and produces chips with geometries in the range of 3.0 to 0.35 microns — far larger than what in today's competitive DRAM business is used. Also the report fails to answer the question why any company in the world could be motivated to enter the DRAM market which is currently characterized by massive oversupply and extreme price pressure.

Qimonda declined to comment. Mr. Jaffé's office acknowledged that currently there is a Qimonda delegation in Hong Kong for talks with potential investors. While representatives of Jaffé's office are participating in the negotiations, the insolvency administrator does not attend the talks in person, the spokesperson said. While he declined to comment on the report, he made clear that no fast solution is in sight. "No matter with whom Infineon has negotiated, the insolvency has created a different situation," he said, adding that currently there "there are first contacts with potential investors, but no concrete negotiations."