Toshiba, SanDisk invest $4 billion in flash memory production

Toshiba, in conjunction with SanDisk, plans to build a new memory chip production factory in Yokkaichi, Japan.

According to Reuters, Japanese publication the Nikkei says that a total of 400 billion yen (approximately $4 billion) will be spent to construct the new building.

The new factory will be built on the grounds of the Toshiba-SanDisk plant in Yokkaichi, Japan.

The tech giant intents to build chips of 16-17 nanometers circuit line width. At the moment, the Yokkaichi plant produces chips with a width of 19nm -- and so by making more chips from silicon wafers, the firms may be able to gain some ground while competing with Samsung's flash memory offerings.

The Nikkei says that after beginning production next year, the plant's output capacity will increase by roughly 20 percent, based on current estimates of 450,000 300mm wafers currently being produced each month.

At part of the deal, the new factory's bill will be split between the two manufacturers.

Toshiba and SanDisk's long-term joint venture focuses on the production of NAND flash memory. The joint venture has managed to survive through the recession and has come a long way from 2009, where the companies were forced to cut the production of chips due to low consumer demand.

While flash memory is in constant demand due to the popularity of mobile devices, other areas of business are not doing so well. Last month, Toshiba announced restructuring plans which will slice away $300 million in costs from its television and PC businesses over the next few years. The firm cited a weak global economy and poor consumer demand as the reasons to make restructuring necessary.