Samsung withdraws bid to acquire SanDisk

SEOUL/SOUTH KOREA: Samsung Electronics Co said on Wednesday it has withdrawn a bid to acquire U.S. flash memory card maker SanDisk Corp.

In a letter dated and released Wednesday, Samsung Vice Chairman and CEO Lee Yoon-woo informed the SanDisk board that the company's $26 a share offer was no longer on the table.

The letter said the offer was being withdrawn ``after nearly six months of efforts to pursue a transaction with no meaningful progress.''

Milpitas, California-based SanDisk could not immediately be reached for comment.

SanDisk said last month it had rejected Samsung's US$5.85 billion takeover bid after its board determined the deal was ``inadequate in multiple respects.''

Samsung said the offer was ``full and fair.'' SanDisk called it ``opportunistic.''

In his letter, Lee told SanDisk that Samsung had determined that acquiring the company amid what he called ``growing uncertainties in your business'' went against ``obligations to our own shareholders.''

Lee cited SanDisk's third-quarter earnings results and its relationship with Japan's Toshiba Corp. as points of concern.

SanDisk announced Monday it had posted a loss of $155 million in the third quarter on a drop in revenue as excess inventory forced it to cut prices.

The company said earlier that day it would sell to Toshiba, a Samsung rival, about 30 percent of the manufacturing capacity of their joint ventures.

Samsung appeared, however, to hold out the possibility of a lower offer, with Lee saying ``we are no longer interested in acquiring SanDisk at $26 a share.''