14 DAY TRIAL // Western Digital, the renowned hard drive maker, has announced today that it bought SanDisk, an American company that manufactures and sells flash memory storage devices and software.
According to the transaction's details, Western Digital has agreed to buy all of SanDisk's shares for a combination of cash and stock, with SanDisk stock valued at $86.50 (€76.23), 15% higher than the price at which the shares were valued on the stock market a day prior.
Following the acquisition, Western Digital's CEO Steve Milligan will continue to serve as the company's CEO, while SanDisk CEO Sanjay Mehrotra will join the Western Digital board.
The move is not surprising, since earlier this month there were rumors of SanDisk actively looking for a buyer.
Both SanDisk and Western Digital have reported good results in their last quarter financial results.
Western Digital is entering the flash memory storage market, via SanDisk
After more and more smartphone and tablet manufacturers have been deploying flash memory with their products, WD's recent move seems to be an attempt at getting a piece of the flash memory market pie, with SanDisk currently being seen as the third-best player behind Samsung and Toshiba.
Western Digital's presence in this market was minimal, even if in December 2014 WD acquired Skyera, a flash-based storage development company.
Despite being ranked third in the flash memory storage market, SanDisk's situation isn't rosy either. Earlier this year, Apple agreed to buy Samsung chips for its line of iPhone, iPad, and Mac products, dropping SanDisk's SSDs, which it used until that point. Apple was by far SanDisk's bigger customer, accounting for a fifth of its revenue.
The move didn't go well on the stock market and for SanDisk's investors, and from that point on, the "looking for a buyer" rumors started surfacing once every few weeks.