Hard disk drive maker Western Digital Corp. has emerged as the strongest suitor of SanDisk Corp. in a potential acquisiton deal for the US$14.6 billion memory chip maker.
Western Digital and SanDisk are in advanced talks regarding a sale but a deal is far from certain, according to Reuters.
Other offers have come from unnamed companies but Western Digital has emerged as the stongest candidate, sources said.
Both companies declined to comment.
Demand for cheaper chips and new products, as well a driver from technology companies to consolidate suppliers, has led to record levels of dealmaking in the semiconductor sector this year.
Any deal with SanDisk will require a sign-off from Toshiba.
SanDisk uses Toshiba’s foundries to make its chips and the two have an important intellectual property-sharing joint venture.
Analysts have said Toshiba is more likely to accept Western Digital as a buyer for SanDisk than Micron, a rival memory chip maker.
Western Digital, which has a market capital of about US$22 billion, is also expected to receive a US$4 billion cash infusion from China’s state-backed Tsinghua Holdings Co. Ltd., if the deal passes regulatory scrutiny in the United States.
SanDisk, which is scheduled to report quarterly results on Wednesday, has grappled with falling prices in the flash memory market and lean inventory.
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