Infineon in talks to team up with NXP -report

FRANKFURT, May 14 (Reuters) - The chairman of German chipmaker Infineon (IFXGn.DE) has talked with private equity group KKR's Europe chief about a merger between Infineon and KKR-owned chipmaker NXP, a newspaper reported on Wednesday.

The Financial Times Deutschland (FTD) daily said such an entity would have annual sales of over 10 billion euros ($15.5 billion) and 67,000 staff, excluding Infineon's majority-owned memory chipmaker Qimonda QI.N.

An Infineon spokesman declined to comment.

The talks between Infineon Chairman Max Dietrich Kley and Johannes Huth, head of Europe for Kohlberg Kravis Roberts (KKR), are part of a power struggle between Kley and Infineon's Chief Executive Wolfgang Ziebart, who opposes a merger with NXP, the FTD said.

Ziebart has long been in favour of disposing of the loss-making Qimonda, while Kley has wanted to move cautiously in that respect, the newspaper said.

(Reporting by Peter Starck, editing by Will Waterman)

((peter.starck@reuters.com; +49 69 7565 1217; Reuters Messaging: peter.starck.reuters.com@reuters.net))

($1=.6469 Euro) Keywords: INFINEON/

(C) Reuters 2008. All rights reserved. Republication or redistribution ofReuters content, including by caching, framing or similar means, is expresslyprohibited without the prior written consent of Reuters. Reuters and the Reuterssphere logo are registered trademarks and trademarks of the Reuters group ofcompanies around the world.nL14251457