The offer values SanDisk common stock at $86.50 per share or a total equity value of approximately $19 billion. The transaction* will be financed by a mix of cash, new debt financing and Western Digital stock. In conjunction with the transaction, Western Digital expects to enter into new debt facilities totaling $18.4 billion, including a $1.0 billion revolving credit facility.
BofA Merrill Lynch, J.P. Morgan, RBC Capital Markets and Credit Suisse will provide committed financing.
The acquisition will allow Western Digital to transform into a global storage solutions company with expertise in non-volatile memory (NVM). It will double its addressable market and vertically integrate into NAND.
Steve Milligan, chief executive officer, Western Digital, will continue to serve as chief executive officer of the combined company, remaining headquartered in Irvine, California. Upon closing, Sanjay Mehrotra, president and chief executive officer, SanDisk, is expected to join the Western Digital Board of Directors.
Western Digital and SanDisk’s complementary product lines, including hard disk drives, solid-state drives, cloud datacenter storage solutions and flash storage solutions, will provide the foundation for a broader set of products and technologies from consumer to datacenter. Toshiba and SanDisk, which have been strategic partners for 15 years, will continue to collaborate. The joint venture will provide stable NAND supply at scale through a time-tested business model and extends across NVM technologies such as 3D NAND.
FinSMEs
21/10/2015
*The transaction is subject to approval by SanDisk shareholders.