We can't say that this news came completely out of left field, since it had already been rumored that SanDisk was going around courting potential buyers. So, just as competitor Seagate has gone around acquiring companies, Western Digital has now announced that it is snatching up SanDisk for a cool $19 billion. That'll come through a mix of cash and stock.
The particulars of the deal need to be worked out, but it sounds like they're valuing SanDisk at $86.50 a share. That's a 15% premium over the closing price from yesterday, valuing the company as a whole at $15.4 billion. This is likely great news for both companies, as SanDisk has been suffering from inventory and production issues, while Western Digital might find its hard drive business shrinking as more people move toward SSDs and flash storage.
The deal could also represent some pretty terrific synergy, as they'll be able to leverage each company's strengths. Combining flash with spinning platters for hybrids is a good stop-gap measure for a lot of people, so it makes me wonder if a hybridized addition to the My Cloud family could be coming down the pipes. Western Digital says the acquisition should assist both its consumer product line, as well as its data centers.
The expectation is that current Western Digital CEO Steve Milligan will stick around as head honcho, while SanDisk CEO Sanjay Mehrotra will join the board with his new flashy, spinning platter overlords.