Samsung Electronics Co., the world's second-largest chipmaker, scrapped its $5.85 billion unsolicited bid to buy SanDisk Corp. after negotiations stalled and the value of the U.S. company declined.
Samsung withdrew its offer to buy SanDisk at $26 a share, the Suwon, South Korea-based company said in a statement today. Last month, Milpitas, California-based SanDisk rejected the bid for being too low.
``After nearly six months of efforts to pursue a transaction with no meaningful progress, we are withdrawing our proposal to acquire SanDisk,'' Lee Yoon Woo, Samsung's chief executive officer, wrote in a letter to SanDisk Chief Executive Officer Eli Harari ``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.''
A purchase would have given Samsung semiconductor patents held by SanDisk and help widen its lead over Toshiba in the $15 billion market for flash-memory chips that store songs and pictures in consumer electronics. SanDisk this week reported a second consecutive quarterly loss after an industry glut drove down chip prices.
SanDisk spokesman Ryan Donovan said the company didn't have any immediate comment.
