Western Digital completes SanDisk purchase

The approximately $16 billion transaction sees SanDisk become a product line within Western Digital.

The acquisition of SanDisk by Western Digital closed on Thursday, US time, with the combined company set to have around 74,000 employees, and the "integration process" to begin immediately and happen in phases over the next two years.

Originally announced in October, SanDisk shareholders received $67.50 in cash, plus 0.2387 shares of Western Digital common stock, pinning the transaction at around the $16 billion mark.

The transaction was originally set to cost around $19 billion, but Western Digital's share price has almost halved since then to sit just above $36 per share in Thursday's after-hours trading.

In February, Chinese Tsinghua University-owned Unisplendour pulled out of a deal that would have seen it gain a 15 percent stake in Western Digital, before it was nixed by a foreign investment review.

That deal would have seen Unisplendour part with $3.775 billion in return for Western Digital common stock issued at $92.50 per share, along with a seat on Western Digital's board.

Speaking yesterday, Western Digital CEO Steve Milligan said it was a significant day in his company's history.

"This transformational combination creates a media-agnostic leader in storage technology with a robust portfolio of products and solutions that will address a wide range of applications in almost all of the world's computing and mobile devices," he said.

The deal will see Sanjay Mehrotra, co-founder, president, and chief executive officer of SanDisk, join the board of directors of Western Digital.

In its third quarter results, Western Digital reported net income of $74 million on revenue of $2.8 billion, compared to net income of $384 million and revenue of $3.5 billion one year ago.

"Computer usage continues to shift from PCs to mobile devices and enterprise workloads are moving increasingly to cloud-based architectures," Milligan said last month. "After we complete the acquisition of SanDisk, we will be better positioned to address and capitalise on these changes and opportunities."