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Sun 6 Aug 2006 04:00 AM

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SanDisk gets flash with US$1.5bn deal

US firm SanDisk is to pay around US$1.5 billion for fellow flash memory maker Msystems in a deal that is the latest sign of consolidation in the sector.

US firm SanDisk is to pay around US$1.5 billion for fellow flash memory maker Msystems in a deal that is the latest sign of consolidation in the sector.

Through the Msystems acqu isition, SanDisk, which sells flash memory cards that are used to store digital data in devices such as cameras, will be able to bring the cost of manufacturing its cards down considerably due to agreements Msystems has with makers of flash chips — the most expensive component in the product.

SanDisk chairman and CEO Eli Harari said the acquisition would give the combined company “critical mass” and complementary products, customers, channels, technology and manufacturing base to take their business forward.

Just two months ago another US-based company, Micron Technology, completed the purchase of memory-card maker Lexar Media for US$850million and analysts have suggested South Korean flash suppliers Samsung and Hynix Semiconductor may be on the lookout to acquire a company that could give them a direct presence in the US retail market.

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