SanDisk Corp., a maker of flash memory used in cell phones and digital cameras, has agreed to buy its rival msystems in an all-stock transaction. Israel-based msystems is a developer of memory used in mobile phones and other devices.
"This strategic acquisition will give us the critical mass and complementary products, customers, channels, technology and manufacturing base to take our shared vision to the next level. The NAND flash data storage business is in its early stages and we believe the market opportunity is largely untapped," said Eli Harari, Chairman and CEO of SanDisk.
Eli Harari said joint company to should generate an annual revenue of USD billion in four to five years time.
SanDisk said under the deal each share of Msystems would be converted into 0.76368 of SanDisk common stock, which it said was a 26 percent premium over the average closing price of Msystems' shares for the last 30 trading days.
The deal is subject to Israeli court approval, regulatory approval and Msystems shareholder approval, and is expected to close in the fourth quarter of 2006.
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