The rating on Korea-based MagnaChip Semiconductor LLC, the former non-memory chip division of Hynix Semiconductor Inc. (B-/Stable/--), reflects the company's exposure to the highly competitive and fragmented market for non-memory semiconductors and substantial debt burden. The ratings are supported by the company's relatively good position within certain market segments with favorable growth prospects, such as CMOS image sensors and display drivers that are used for handsets and TFT-LCD screens, strong customer relationships, and good cost structure. MagnaChip faces severe competition from market giants such as Samsung Electronics Co. Ltd. (A-/Stable/A-2), NEC Electronics (NR), and Toshiba Corp. (BBB-/Stable/A-3), which have substantial financing capabilities. Other competitors include companies with similar backgrounds in the DRAM segment that are looking to better utilize their
