Chipmaker SanDisk hired a bank to explore a potential sale of the business and has received interest from two of its rivals, people with knowledge of the matter said.
Micron Technology and Western Digital are in talks with SanDisk about a possible acquisition, said the people, who asked not to be identified because the process is private. SanDisk, based in Milpitas, operates flash- memory plants with Toshiba in Japan, and would likely need Toshiba”s blessing for a deal.
No decision has been made and talks with the companies may not result in a transaction, the people said.
SanDisk, with a market value of about $12.6 billion, is one of the largest makers of flash memory, a type of chip that”s used as storage in mobile devices and increasingly in computers and data centers. Micron is a rival supplier of the technology and Western Digital, which makes hard drives based on spinning magnetic disks, may want to add a source of flash-memory chips to keep future products competitive.
Representatives for SanDisk and Irvine-based Western Digital didn”t immediately respond to requests for comment. A spokesman for Boise, Idaho-based Micron said the company doesn”t comment on rumors.
This year to date has been the biggest ever for semiconductor mergers and acquisitions. Companies in the $300 billion industry are facing rising costs and a shrinking customer base, encouraging them to get together to add scale. Last month Western Digital got a $3.8 billion investment from China”s Tsinghua University, adding to its funds available to make deals.
SanDisk and Micron compete with the larger Samsung Electronics, which dominates the market for memory chips and is also one of the biggest consumers of the storage semiconductors via its handset division. Flash memory chips are much faster at reading and writing data and use less energy making them increasingly attractive as storage in data centers run by companies such as Google and Amazon.com.