Infineon: Will Russia Take A Stake?

The Russian government is reportedly in talks to buy a stake in chip maker Infineon (IFNNY.PK).

According to Bloomberg, Leonic Melamed, the CEO of the Russian holding company AFK Sistema said at a new conference that the Russian government plans to buy a stake in Germany-based Infineon. He says Sistema won’t buy shares in the deal, but that it has been “invited to participate” as an industry expert.

Bloomberg notes that a Russian newspaper previously had reported that Sistema wanted to buy a 20% stake in the chip company for about 1 billion Euros.

Meanwhile, Bank of America/Merrill Lynch analyst Jonathan Crossfield this morning cut his rating on the stock to Underperform from Outperform, noting that the shares had moved above his 3.80 Euro/$5.60 U.S. price target. He contends Infineon shares look expensive relative to others companies in the sector; he thinks better bets in the European chip sector would be STMicro (STM) or ASM International (ASMI)

In trading on the pink sheets, Infineon shares are down 15 cents, or 2.7%, to $5.48.