MENU

China-backed Western Digital swoops on SanDisk

China-backed Western Digital swoops on SanDisk

Business news |
By eeNews Europe



It had been previously reported that SanDisk was up for sale and the Western Digital offer of $86.50 per share is made up of $67.50 in cash and the remainder made up in Western Digital stock.

Western Digital is in the process of selling a 15 percent stake in itself to Chinese state controlled Unisplendor Corp. Ltd. for $3.775 billion. The company said that if the investment closes prior to the acquisition of SanDisk, Western Digital would pay $85.10 in cash and the remainder in share in the company.

SanDisk has been a successful vendor of flash memory for computer peripheral markets and to ensure supply entered into a manufacturing joint venture with Toshiba Corp. However, both SanDisk and Toshiba now lie behind South Korean competitors Samsung and SK Hynix as volume manufacturers and face the cost of gearing up for a transition to 3D production of memory.

Toshiba has been hit by the financial scandal that it lied about its financial position for over seven years by about $1.9 billion, which caused the resignation of its CEO.

Western Digital said the manufacturing joint-venture with Toshiba will continue and will be able to provide 3D NAND "at scale." For Western Digital this provides an internal supply of NAND flash at a time when personal computers are turning to solid-state drives and tablet computers and smartphones predominantly use non-volatile memory.

"The combination enables Western Digital to vertically integrate into NAND, securing long-term access to solid state technology at lower cost," Western Digital said in a statement.

Steve Milligan, CEO of Western Digital, will continue to serve as DEO of the combined company, and the company. Upon closing, Sanjay Mehrotra, CEO of SanDisk, is expected to join the Western Digital board of directors. 

The transaction is subject to approval by SanDisk shareholders and, in the event that the Unisplendor transaction does not close, Western Digital shareholders, receipt of regulatory approvals and other customary closing conditions. The transaction is expected to close in the third calendar quarter of 2016.

Related links and articles:

www.wdc.com

www.sandisk.com

News articles:

Report: SanDisk mulls company sale

Toshiba CEO resigns over accounting scandal

China bids $23 billion for Micron

Toshiba execs in firing line, accounting probe nears conclusion

If you enjoyed this article, you will like the following ones: don't miss them by subscribing to :    eeNews on Google News

Share:

Linked Articles
10s