Western Digital Announces Definitive Agreement To Buy SanDisk For $19B In Cash And Stock


Western Digital agreed to acquire SanDisk for a whopping $19 billion, a move that is bound to give the company access to a supply of semiconductors that are leading the way on a fast growing computer storage.

From what we have come to understand, Western Digital will pay $86.50 per share to grab SanDisk, which also includes $85.10 in hard cash. SanDisk gained a market value of $15.4 billion after closing at $75.19 in New York on Tuesday.

"This transformational acquisition aligns with our long-term strategy to be an innovative leader in the storage industry by providing compelling, high-quality products with leading technology," said Steve Milligan, chief executive officer, Western Digital. "The combined company will be ideally positioned to capture the growth opportunities created by the rapidly evolving storage industry. I'm excited to welcome the SanDisk team as we look to create additional value for all of our stakeholders, including our customers, shareholders and employees."

Western Digital has no chance but to branch out into other markets as its home markets shrink. Back in 2014, the company had a 44 percent control of the market, though throughout 2015 so far, its market share has declined by 4 percent due to high levels of competition. The overall business fell to $32.9 billion, according to information from IDC Corp.

When it came down to the market for NAND flash chips, SanDisk in its joint partnership with Toshiba Corp, $28.9 billion in 2014 as the largest producers of the hardware.

From these numbers, it is easy to see why Western Digital is interested in placing SanDisk under its wings. The need for these flash chips will likely continue to grow in the years to come as mobile devices slowly become the center of our lives, possibly replacing full-fledged computers altogether.

This is evident by sales numbers and Microsoft's new software technology, Continuum. The company demoed this cool innovation at it recently held conference where it announced several new Windows 10 hardware devices.

Continuum is all about using your smartphone to achieve a desktop-like work environment when connected to a computer monitor. Should it be adopted by consumers, we can be certain other companies will follow Microsoft's lead down this interesting path.

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