Samsung Withdraws Bid For Sandisk After Q3 Earnings Spooked It

imageThere falls another bigger deal: Samsung has withdrawn its proposal to acquire SanDisk…it launched a public bid for $26 per share in cash last month. The memory card maker rejected the bid right after, and it was only a matter of time before Samsung had to cave in, considering the current economic climate (not conducive to public takeovers), and of course SanDisk’s less-than-stellar earnings yesterday.
From Yoon Woo Lee, the CEO of Samsung, in a public letter of to SanDisk’s board: “We have obligations to our own shareholders which require that we take a disciplined approach, particularly with respect to significant initiatives such as this. That disciplined approach requires that we squarely face the growing uncertainties in your business, which may continue to deteriorate in this difficult economic environment and further impact your standalone value. Your recently announced third quarter results serve only to illustrate this risk. Your surprise announcements of a quarter billion dollar operating loss, a hurried renegotiation of your relationship with Toshiba and major job losses across your organization all point to a considerable increase in your risk profile and a material deterioration in value…As a result of these developments, we are no longer interested in acquiring SanDisk (NSDQ: SNDK) at $26/share.”
Meanwhile, SanDisk has responded to this: “From the start of this process SanDisk