SK hynix Inc., South Korea's second-largest chipmaker, said Wednesday it has reached a settlement with US-based Netlist Inc. over memory technology patents.

The two sides agreed to a patent cross license covering chip technologies of both companies.

Under the deal, SK hynix will gain access to Netlist's portfolio of US and foreign patents. Netlist will receive a royalty from SK hynix, a cross license to SK hynix's patent portfolio and supply of its memory and storage products.

Industry observers speculate Netlist to receive about $40 million in royalties from SK hynix.

The deal also includes Netlist and SK hynix collaborating in advanced memory and storage technology for future commercialization.

Netlist filed suits against SK hynix with the US International Trade Commission (ITC) in 2016 and 2017 over patent infringements, though they ended in favor of the South Korean firm.

The company last year took the cases to the US District Court for the Western District of Texas.

But with the latest agreement, the two companies said they will end their battles in the US District Court for the Western District of Texas and the Patent Trial and Appeals Board of the US Patent and Trademark Office. (Yonhap)