
Western Digital agrees to buy SanDisk for about $19B - jsnathan
http://www.bloomberg.com/news/articles/2015-10-21/western-digital-agrees-to-buy-sandisk-for-about-19-billion
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shas3
The consolidation in the semiconductors/chip IP industry, thus far in 2015:

1\. Intel-Altera: [http://www.bloomberg.com/news/articles/2015-06-01/intel-
buys...](http://www.bloomberg.com/news/articles/2015-06-01/intel-buys-altera-
for-16-7-billion-as-chip-deals-accelerate)

2\. Avago-Broadcom (and earlier, Avago + LSI):
[http://www.bloomberg.com/news/articles/2015-05-27/avago-
said...](http://www.bloomberg.com/news/articles/2015-05-27/avago-said-near-
deal-to-buy-wireless-chipmaker-broadcom)

3\. Silicon Imaging-Lattice: [http://www.wsj.com/articles/lattice-to-buy-
silicon-image-for...](http://www.wsj.com/articles/lattice-to-buy-silicon-
image-for-600-million-1422358580)

4\. NXP-Freescale:
[http://www.eetimes.com/document.asp?doc_id=1327236](http://www.eetimes.com/document.asp?doc_id=1327236)

5\. (2014) Cirrus-Wolfson:
[http://www.eetimes.com/document.asp?doc_id=1322171](http://www.eetimes.com/document.asp?doc_id=1322171)

6\. Avago is further looking at Xilinx, Maxim, and Renesas:
[http://www.reuters.com/article/2015/05/14/us-chipmakers-
m-a-...](http://www.reuters.com/article/2015/05/14/us-chipmakers-m-a-avago-
idUSKBN0NZ27520150514)

This is one industry that is in flux ATM.

Edit: Further afield, though tightly coupled with this industry, on the
manufacturing equipment side, Lam Research announced acquisition of KLA-Tencor
today [http://www.wsj.com/articles/semiconductor-firm-lam-
research-...](http://www.wsj.com/articles/semiconductor-firm-lam-research-to-
buy-kla-tencor-1445419669)

~~~
normaldotcom
Another consolidation this year: Dialog is buying Atmel, although Atmel is
fairly small compared to the other big players in the microcontroller market.

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mathgeek
For those wondering where all the other hard drive companies went:
[https://upload.wikimedia.org/wikipedia/commons/thumb/8/87/Di...](https://upload.wikimedia.org/wikipedia/commons/thumb/8/87/Diagram_of_Hard_Disk_Drive_Manufacturer_Consolidation.svg/2000px-
Diagram_of_Hard_Disk_Drive_Manufacturer_Consolidation.svg.png)

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sschueller
This sucks for consumers. Prices are already way to high for HDs and don't
seem to come down anymore. It is as if there is some sort of price fixing
going on.

~~~
digitalzombie
Yeah seriously, SanDisk own patents to flash IIRC, their stuff is always less
than their competitors.

I hope WD isn't going to jack up prices.

~~~
dogma1138
SandDisk SSD's aren't cheaper, not when you are comparing oranges to oranges,
they sell allot of very very low end SSD's their performance series costs more
than comparable drives from Samsung.

There are other companies that also sell cheap SSD's like Micron and Crucial
but the big names Samsung, Intel, OCZ(Toshiba) usually sell quite high end
devices.

Samsung pretty much blew the market out of the water with their Evo series it
comes very close to the performance of it's Pro series and other high end
SSD's out there where it comes to real world use at a fraction of the cost. It
brought the costs of SSD's down to less than 350$ per TB while keeping
outstanding performance and life span.

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trymas
I always have thought that companies were bought for a price of it's market
value (stock price * number of stocks), or if someone did not wanted pay all
in cash they would've tried to compensate in other ways until market value is
reached.

But here WD bought SD for ~85-86$ per share, when it was worth ~75$ per share.
It's at least 13% more.

Does it simply mean that WD hopes that SD will rise in value rapidly? Or I
imagined company buying evaluation wrong?

~~~
nashashmi
They issued $18 bln in new debt. Does that mean they only paid $1 bln for it?

~~~
wjnc
That depends on who issued the debt and what happened after that. If WD issued
the debt, they could use that incoming cash to pay the old stockholders to
gain the shares in SanDisk. That would be a real cash outflow. Bigger company
after the transaction, and bigger debt.

Alternative is that WD pays cash to stockholders they might have had lying
around. Then issue debt in SanDisk and pay dividend upstream from Sandisk to
WD afterwards. Bigger company, and bigger debt result, only different place
for the debt. Sometimes tax incentives help which route to choose (private
equity often loads up firms on debts, since interest is deductible).

Only way to 'pay less' would be (happens sometimes) that you can buy a company
that holds a lot of cash, but that has a relatively low valuation one way or
the other. Perhaps stockholders sense risks and don't expect dividends (market
cap in that sense is expected value of future earnings plus lots of noise).
Then you buy company, and use the cash for superdividend right away. Bigger
company results, but with relatively stronger solvency since you've paid part
from cash that was 'undervalued'.

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koberstein
Now if they could just fix the broken firmware they released for my WD Live TV
player.

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jordancj
These companies both sound like bad western tech crossover movies from the
80's. This was bound to happen.

