Western Digital is one of the leading factors in traditional storage, both for consumers and enterprises alike, but a lot of the future will be in solid state drives and they naturally don’t want to be left out of that race. Western Digital isn’t entirely new to the solid state area and they already have products that utilize NAND. That position should be strengthened even more now that they have acquired SanDisk. The purchase is composed of both cash and stock.
“The offer values SanDisk common stock at $86.50 per share or a total equity value of approximately $19 billion, using a five-day volume weighted average price ending on October 20, 2015 of $79.60 per share of Western Digital common stock. If the previously announced investment in Western Digital by Unisplendour Corporation Limited closes prior to this acquisition, Western Digital will pay $85.10 per share in cash and 0.0176 shares of Western Digital common stock per share of SanDisk common stock; and if the Unisplendour transaction has not closed or has been terminated, $67.50 in cash and 0.2387 shares of Western Digital common stock per share of SanDisk common stock. The transaction has been approved by the boards of directors of both companies.”
At around 19 billion, this is certainly no small deal. Western Digital will gain a company with 27-years of experience in some of the best and most impressive NAND products and create a stable future for the company where they can compete on all fronts, including the NVMe based drives that we’d all like to have these days. With 15 thousand combined patents between them, they also have a strong foundry against the fierce competition in the storage market.
The transaction is still subject to approval by SanDisk shareholders, but both boards of directors in the two companies have agreed. The deal is expected to get finalized in the third quarter of 2016.
