Asian Tech Press (OCT 22) --  According to Reuters, citing sources familiar with the matter, merger talks between U.S-based Western Digital and Japanese chipmaker Kioxia have stalled, underscoring the huge challenge of closing deals in the semiconductor industry.

This August, it was reported that Western Digital was in advanced talks with Kioxia on a possible merger, and the size of the deal could be as large as $20 billion. It was said that the two sides could reach an agreement as early as mid-September, with current Western Digital CEO David Goeckeler in charge of the combined company's management. The merger could create a NAND memory giant big enough to rival semiconductor giant Samsung Electronics of South Korea if negotiations are successful.

However, people familiar with the matter said that negotiations have stalled in recent weeks due to a series of problems. The negotiations involve valuation differences, uncertainty over whether the Japanese government will approve it, and an ongoing strategic assessment by Kioxia shareholder Toshiba Corp.

Western Digital remains eager to move forward with the deal on the right terms, the people familiar with the matter said.