In the transaction, each M-Systems ordinary share will be converted into 0.76368 of a share of SanDisk common stock, representing a 26% premium over the average closing price of M-Systems' shares for the last thirty trading days, but a premium of just 13% over M-Systems' closing price on Friday. The transaction is expected to close in the fourth quarter of 2006. SanDisk chairman and CEO Eli Harari said, "SanDisk and M-Systems, over the past 18 years, have been leading innovators in the flash storage market. This strategic acquisition will give us the critical mass and complementary products, customers, channels, technology and manufacturing base to take our shared vision to the next level.
"The NAND flash data storage business is in its early stages and we believe the market opportunity is largely untapped. M-Systems is a leader in flash memory systems addressing mobile, portable and embedded markets and they have a strong team, significant IP and important OEM customers. SanDisk has a record of creating new market categories, world-class manufacturing capabilities and leading market share in the retail channel.
M-Systems chairman and CEO Dov Moran said, "From mDOC to megaSIM, from U3 to x4, M-Systems is creating new markets through innovation. We are truly proud of our achievements to date. This strategic deal will enable us to continue supporting our OEM customers, to whom we remain fully committed, and strengthen our innovation and product offering with SanDisk's leading edge, low-cost fab capacity. "This deal has synergy at its core, encompassing people, technology, products and customers. Based on our shared vision, as well as our teams' history of successful and fruitful cooperation, I am confident we can succeed in achieving the goals we set for ourselves. I also believe that SanDisk's extensive silicon expertise will prove itself as a strong catalyst to productizing our revolutionary x4 technology as well as other future innovations."
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