Samsung pulls out of Sandisk deal

SAMSUNG has pulled out of a deal to buy US flash memory card maker Sandisk because of "growing uncertainties" in the outfit.

Samsung vice chairman and CEO Lee Yoon-woo has penned a farewell note to Sandisk's board saying that his $26 a share offer was no longer on the table, basically because the company was not worth the cash.

Samsung suggested it might still be interested in buying Sandisk, but for much less cash.

It is not clear if Sandisk will take any new bid. The pair had been negotiating for nearly six months before Samsung fled the table.

Sandisk said last night that Samsung's got cold feet despite Sandisk having outlined a path for further discussions. It said it was a bit miffed that the electronics giant never called.

It said it doubted Samsung was ever serious in the first place.

The flash memory maker said in a statement:"We repeatedly outlined a clear path to hold further discussions, including most recently in our letter on September 15, and Samsung consistently chose to ignore that path and, in fact, never contacted Sandisk regarding their proposal after we delivered our letter. We believe this raises questions about the real motivations behind Samsung's offer."

Samsung's Lee said there were growing uncertainties in Sandisk's business, which may continue to deteriorate in this difficult economic environment and further impact in the company value.

Sandisk said on Monday it intends to sell 30 per cent of its manufacturing capacity to Toshiba which is a Samsung rival. µ