Samsung has been rejected by SanDisk after it offered to buy the company for $26 (£13) per share yesterday.
According to economics website PaidContent.org
, Samsung has been in negotiations with solid-state memory expert SanDisk for four months, but felt it needed to make a hostile takeover bid after talks fell apart.
As part of the bid – which represented a not-inconsiderable 80 percent hike over the last traded stock price – Samsung has written a letter to the CEO of SanDisk, Eli Harari, which promised that the two companies would be able to “establish the platforms and capabilities necessary to position flash [memory] as the preferred vehicle for delivery and storage of a wide variety of content, such as film, in a way that would not be possible for either of our companies alone.
Sadly for Samsung, the sweet-talking and share hike wasn't enough to woo SanDisk. The company responded yesterday with a firm rejection, claiming the deal was “inadequate in multiple respects.
” The main bone of contention between the two appears to be, surprise surprise, the price: although Samsung's offer represents a significant premium to SanDisk's current share price, the company points out that when Samsung first started negotiations the share price was worth $28.75 – and Samsung had claimed willingness to pay “a significant premium
” over this price if a deal could be agreed. With the offer finally arriving at below
the original stock price, you can see where SanDisk might get a little upset.
Whether this rejection will result in a higher offer from Samsung, or whether the company will look elsewhere for its flash technologies, remains to be seen.
Can you imagine good things coming out of a SanDisk-Samsung merger, or is the flash memory maker doing the right thing steering clear? Share your thoughts over in the forums