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Intel, Micron & SanDisk bid for Lexar

Posted: 31 Mar 2006     Print Version  Bookmark and Share

Keywords:Mark LaPedus  Lexar Media  Intel  Micron  SanDisk 

Intel Corp., Micron Technology Inc. and SanDisk Corp. were among the 11 companies that made a bid to acquire Lexar Media Inc., according to a new report.

As reported, semiconductor maker Micron announced plans to acquire flash-memory product maker Lexar for Rs.3,009 crore ($680 million). There were also ten other companies that reportedly made separate bids to acquire Lexar. Intel also made a bid to acquire Lexar, but the chip giant is said to have "backed out," said Satya Chillara, an analyst with American Technology Research Inc., in the report issued on March 29.

Flash-memory product rival SanDisk also made a bid to acquire Lexar for Rs.387.19 ($8.75) a share, Chillara said while Micron's bid for was said to be Rs.358.87 ($8.11) a share. "We believe SanDisk was interested in the IP portion of Lexar," he said, noting that this particular deal could face some problematic regulatory issues. The combination of SanDisk and Lexar would hold 50 to 55 per cent market share for flash cards, USB drives and other products in the United States, according to the analyst.

SanDisk apparently did not pursue its original offer for Lexar, but the market is now "anticipating another offer from SanDisk or another third party," according to the analyst. "If SanDisk were to sweeten the deal, it could force Lexar to reconsider."

Several investment firms, including billionaire financier Carl Icahn, are attempting to block Micron's proposed Rs.3,009 crore ($680 million) deal to acquire Lexar. The firms are reportedly putting pressure on Lexar to find a better suitor. Micron's bid for Lexar is too low, according to the firms. But so far, any bidder has not apparently surfaced, giving Micron the upper hand in the deal, according to reports.

- Mark LaPedus
EE Times

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