The country doesn't want to share the Japanese semiconductor technology to foreign companies as it may be a threat to the national security.
These concerns were raised in regard to Foxconn's participation in the auction, because of the company's links to China. The bulk of Apple's iPhones are manufactured at Foxconn's extensive manufacturing base there.
Apple is also considering teaming up with its manufacturing partner Foxconn, which is trying to acquire about 30 percent of the stake, the report said. Apple Inc. did not make any comment on this matter.
An investment by Apple would be its first direct stake in a major global memory chipmaker as it seeks to secure a stable supply of key components.
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SK Group's chief has shown a strong will to take over the memory division of Japanese tech giant Toshiba Corp., as the group's chipmaking unit, SK hynix Inc., joined the race for the acquisition. The Japanese company is in the process of narrowing down the bidders for the semiconductor business, which is profitable.
The Yomiuri newspaper said last month that Apple was among the bidders for the chips unit.
The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company's headquarters in New Taipei City, Taiwan March 29, 2016. As for Apple, we have to point out its costliest confirmed acquisition to date was that of Beats Electronics for $3 billion, with $1 billion recently contributed to the growth of Uber's Chinese "killer" Didi.
Toshiba president Satoshi Tsunakawa earlier said, "We will put priority on the price and the quick completion of transaction when selecting an acquirer".