Toshiba Corp. said Tuesday it will terminate its business in dynamic random access memory chips next year in a reorganization aimed at securing profitability in its semiconductor business in fiscal 2002.

Under the measure, the major semiconductor maker will sell all assets including DRAM production equipment at Dominion Semiconductor LLC, a wholly owned subsidiary in the United States, to Micron Technology Inc. in January.

It also plans to gradually phase out DRAM production at its Yokkaichi plant in Mie Prefecture.

Withdrawal from DRAMs will leave Toshiba with a special loss of about 40 billion yen in the year ending next March, according to the company.

Takeshi Nakagawa, who heads Toshiba's semiconductor operations, said in a press release that the withdrawal "means that Micron's business strategy fits ours. This . . . allowed us to quickly close a deal, even though we had never worked with one another before."

Toshiba chose Micron to smooth its retreat from the DRAM business, Toshiba President Tadashi Okamura said at a news conference.

Toshiba also plans to outsource DRAM assembly, which is handled by Yokkaichi Toshiba Electronics Corp., to third parties, including overseas assemblers.

The future of DRAM assembly at the Yokkaichi plant, which might be liquidated, will be reconsidered in June, the company said.

Toshiba's memory operations, including business management, engineering and production control, will be centralized at the Yokkaichi plant by June to improve decision-making speed and operating efficiency, it said.

Toshiba will also shift production of NAND-type flash memory at FlashVision LLC, a U.S. joint venture between Toshiba and SanDisk Corp., to Yokkaichi.

Toshiba plans to focus on application-specific and high value-added memory products through the reorganization and maintain development of core DRAM technology.