US-based Micron Technology unveiled a deal Monday to buy troubled Japanese chip-making rival Elpida Memory for $2.5 billion, the companies said Monday.

Micron, the world's fourth largest maker of microchips "signed a definitive sponsor agreement" to acquire Elpida in a plan submitted to Tokyo District Court.

Under the agreement, Micron will pay 200 billion yen ($2.5 billion) "to satisfy the reorganization claims of Elpida's secured and unsecured creditors."

Micron will acquire 100 percent of the equity of Elpida under the deal.

That includes $750 million to be paid in cash at closing and the rest in installment payments through 2019.

"As a result of these payments, all pre-petition debt obligations of Elpida will be fully discharged under the corporate reorganization proceedings," the statement said.

"The agreement also calls for Micron to provide certain financing support for Elpida capital expenditures, subject to specified conditions, and to maintain Elpida's operations and employees."

South Korea's SK Hynix, the world's second largest microchip maker, dropped its bid for Elpida earlier this year.

Elpida, one of the world's top microchip makers, was delisted from the Tokyo Stock Exchange late March in the biggest corporate failure in Japanese manufacturing history.

The troubled firm, which had stayed alive thanks to a 2009 government-backed rescue plan, filed for bankruptcy protection in late February with crushing debts of 448 billion yen.

Elpida is a major maker of DRAM chips used in computers and mobile devices such as phones and tables. It has a plant in Hiroshima, Japan, and a 65 percent stake in Taiwan-based Rexchip.

In a related transaction, Micron announced a separate agreement with Powerchip Technology Corporation, another Taiwan firm, to acquire Powerchip's 24 percent share of Rexchip for $334 million.

The two deals will give Micron an 89 percent stake in Rexchip.

"Combining the two complementary product portfolios will further strengthen Micron's position in the memory market and enable it to provide customers with an even more complete set of high-quality solutions," the statement said.

"We are creating the industry-leading pure-play memory company," said Micron chief executive Mark Durcan.

"Today's transactions will help strengthen the combined companies' market position in the memory industry... for the ultimate benefit of Micron and Elpida customers."

Yukio Sakamoto, co-trustee of Elpida, said the deal "will enable stable payment of creditor claims and help to streamline approval of the reorganization plan by the creditors and the Tokyo District Court."