SanDisk buys out Msysystems for $1.55 B

By agencies   |   Monday, 31 July 2006, 07:00 Hrs
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NEW YORK: SanDisk Corp., designers and marketers of flash memory card products, announced its purchasing Israel-based Msysystems, a developer of memory used in mobile phones and other devices, for $1.55 billion stocks.

The deal stated that each share of Msysystems would be converted into 0.76368 of SanDisk’s common stock. The cost was 26 percent premium over the average closing price of Msysystems’s shares over the last 30 trading days. The deal now valued Msysystems’s each share at $36. Msysystems’s shares ended up 70 cents at $31.79 on Friday.

Sanjay Mehrotra, co-founder and COO of SanDisk stated that the deal valued Msysystems at $1.55 billion with Msysystems holding 43 million shares. It was a strategic deal struck by SanDisk with complementary strengths in their products, customers, channels and technology, he said.

The deal is now subject to approvals from the Israeli court, Msystems’s shareholders and a regulatory approval as well, which is expected to close in the fourth quarter. Mehrotra also announced that the company would continue to operate from Israel and as of now there were no plans to shift the base to the U.S.

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