Business

Editor: Crayon Zhang
22 Oct 2008 01:33:02 GMT

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.