Western Digital to acquire SanDisk for $19bn
Storage-maker eyes mobile flash-memory market
Storage manufacturer Western Digital is set to acquire SanDisk for $19bn as the company sets its sights on the mobility market, Reuters reported.
Buying SanDisk will allow Western Digital to make the kind of flash memory components found in smartphones and tablets at a time when the mobility sector is still growing.
SanDisk shares reached a high of $78.50 yesterday, but closed almost $10 below the deal's offer price of $86.50 in cash and stock, which may be due to complications inherent in the purchase.
Western Digital is currently await the closure of a deal in which China's Unisplendour Corp will buy a 15% in the company, for $3.78 billion, but the transaction could be stymied by regulatory oversight. But because the Sandisk acquisition will mean that Unisplendour's stake will shrink, Western Digital CEO Steve Milligan believes the stake purchase will be approved by regulators.
"There's always a risk and you're not done until you're done, but we were careful and consulted with US government experts," he said.