Memory loss

22 October 2008 By Jeff Segal

Its unwanted suitor, Samsung, just dropped its generous offer for the memory maker. Sandisk played hardtoget, but looks to have miscalculated. The 30% fall in the won and Sandisk s own weak earnings made the deal too rich for Samsung s liking.

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Korean electronics company Samsung has dropped its $5.85bn bid for US flash memory maker Sandisk. The bid, which was rejected by Sandisk in September, carried a 93% premium to Sandisk's undisturbed share price at the time.

In a letter to the company, Samsung chief executive Lee YoonWoo said that the decision was made due to "growing uncertainties in [Sandisk's] business, which may continue to deteriorate in this difficult economic environment and further impact [Sandisk's] standalone value".

Sandisk recently made public that it will sell 30% of its manufacturing capacity from three existing joint ventures to Toshiba for $1bn in cash and reduced leasing costs. It also announced a third quarter loss of 69 cents per share on $821m in revenue.

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