South Korea's SK Hynix, the world's second largest microchip maker, said Friday it had pulled out of its bid for ailing Japanese chipmaker Elpida Memory.

"We decided not to participate... it doesn't seem very advantageous strategically," said board chairman Choi Tae-Won.

SK Hynix said in March it had submitted preliminary interest in bidding for Elpida, which filed for bankruptcy protection in February in Japan's largest post-War corporate failure.

The South Korean company swung to a net loss of 271.2 billion won ($237.6 million) in the first quarter, as oversupply and weak demand for personal computers pressured memory chip prices.

The company said last week it aims to maintain a "minimum level" of cash holdings and would only consider investments that would not excessively burden its finances.

The Elpida bid came in March, a month after South Korea's largest mobile carrier SK Telecom completed the acquisition of a controlling 21.1 percent stake in Hynix for 3.34 trillion ($2.95 billion).