It wasn’t long ago we first heard about how Samsung was thinking of acquiring NAND flash manufacturer SanDisk, and it has now been revealed that Samsung and SanDisk have been talking for more than four months. Their opinions regarding the value of SanDisk are still far from matching and eventually forced Samsung into making an official and aggressive bid of 26 USD per stock. This is far below SanDisk’s current stock value. This did not impress the people at SanDisk, which has kept its cool.
SanDisk rejected Samsung’s offer and has been rather specific as to why. SanDisk says Samsung has undervalued SanDisk and at the same time says that the added price per stock looks good right now because of the poor condition of the stock market. Samsung’s offer was 55% lower than SanDisk best high over the last 52 weeks.
“After multiple meetings with Samsung since its original indication of interest in an acquisition, SanDisk’s Board of Directors has deliberated on Samsung’s proposal with advice from its financial and legal advisors, and on September 15, 2008, sent the enclosed letter to Samsung reflecting the board’s unanimous conclusion that the proposal is inadequate in multiple respects and not in the best interests of SanDisk’s stockholders. Samsung responded by reiterating its offer to SanDisk on September 16, 2008.”
SanDisk keeps a strict tone and remains harsh throughout the press release, and the tension between the companies is really building up. This will be a huge deal if they are able to agree on the price. This will of course have a major effect on the flash memory market, and the sub-markets, but SanDisk will certainly make a lot more money now that the bidding has come out in the open.
One can’t help to wonder what this will do to Samsung’s and Apple’s cooperation since SanDisk is Apple’s biggest competition in the USA.
