Samsung Electronics May Acquire SanDisk Corporation

SanDiskThe world’s top maker of memory chips Samsung Electronics announced Friday that is considering buying the U.S. computer memory card maker SanDisk Corp. (SNDK), whose shares have deteriorated since mid-May amid a steep downturn in the memory market.

According to online news provider eDaily – James Chung, a spokesman for Samsung said: “We are looking at various opportunities regarding SanDisk, but nothing has been decided yet”. The story also said Samsung had retained J.P. Morgan as the banker for these negotiations. [Via Bloomberg]

The Seoul, South Korea-based co. is the world’s largest manufacturer of NAND as well as DRAM – gaining, according to iSuppli, 42.3% of the market share in the NAND flash memory-chip market in Q2’08, compared with Toshiba’s 27.5% and Hynix Semiconductor Inc.’s 13.4%.

An acquisition of SanDisk could pay off for Samsung since it will help the co. gain strategic advantages. It will also widen the co.’s lead over Toshiba Corp., in the $15 billion market for chips used in storage devices and digital gadgets. And more importantly, will end the legal fight over the licensing terms between the two rivals, and enable Samsung to avoid paying royalties (over $353.8 million a year) to SanDisk on secure digital flash memory cards.

In August SanDisk Corp. was the subject of speculation that Seagate Technology Inc. (STX) was interested in buying all or part of the co. However, analysts were quick to dismiss the rumors, saying it would be a bad marriage.

Disclaimer: This page contains affiliate links. If you choose to make a purchase after clicking a link, we may receive a commission at no additional cost to you. Thank you for your support!

About Ron Haruni 1068 Articles
Ron Haruni is the Co-Founder & Editor in Chief of Wall Street Pit.

Be the first to comment

Leave a Reply

Your email address will not be published.


This site uses Akismet to reduce spam. Learn how your comment data is processed.