SanDisk Acquires Enterprise Solid-State Drive Maker

Chip photo
Chip photo

Flash memory maker SanDisk Corp. (NASDAQ: SNDK) announced this morning that it has signed a definitive agreement with private equity firm Silver Lake Partners to acquire SMART Storage Systems, a developer of enterprise solid-state drives. SanDisk will pay $307 million in cash and equity-based incentive awards for the company.

The transaction is expected to close next month, and SanDisk noted that it expects the acquisition to be "slightly dilutive" to adjusted earnings per share in the second half of 2013. The acquisition is also expected to add to SanDisk's earnings in 2014.

Last week Western Digital Corp. (NASDAQ: WDC) paid $340 million for solid-state drive maker STEC Inc. (NASDAQ: STEC). And if anyone is looking around for the next in line to be acquired, two viable candidates are OCZ Technology Group Inc. (NASDAQ: OCZ) and Fusion-io Inc. (NYSE: FIO).

OCZ would set a buyer back far less than would Fusion-io, which has a market cap of around $1.4 billion. But OCZ could not complete an acquisition by Seagate Technology PLC (NASDAQ: STX) because the former CEO of OCZ apparently wanted a seat on Seagate's board and the disk-drive maker refused. Seagate's offer was reportedly worth about $1 billion for a company with a market cap at the time of around $300 million. OCZ's market cap now is about $100 million. Shareholders expressed their unhappiness with a nice round of lawsuits.

Shares of SanDisk are down 1.3%, at $60.64 in a 52-week range of $32.08 to $63.73.

Shares of OCZ are up 3.2% today, at $1.58 in a 52-week range of $1.11 to $7.67.

Fusion-io's shares are down 2.5%, at $14.27 in a 52-week range of $12.72 to $32.63.

Filed under: Technology Tagged: FIO, OCZ, SNDK, STEC, STX, WDC