From the Times…

On Friday Qimonda, of Germany, became the first big chipmaker to file for insolvency. The world’s fourth-biggest manufacturer of DRAM memory chips, used mainly in PCs, said that a €325 million (£306 million) rescue attempt by the German state of Saxony, Infineon, its parent company, and a group of banks had not been agreed in time to save it. Qimonda follows Nortel Networks, North America’s biggest telecoms equipment maker, in filing for insolvency.

The semiconductor sector was in poor shape before the present downturn, with large players having spent lavishly in early 2007 on increased production to expand their market share, resulting in oversupply and price collapses. Cash-strapped manufacturers have cut output, but the weakness in demand has prevented any meaningful price gains.