Western Digital to sell $3.2b Sandisk stake at 7.7% discount

Western Digital plans to sell a US$3.2 billion stake in Sandisk, according to the company’s announcement on February 18.

The sale involves over 5.8 million Sandisk shares priced at US$545 each, below the previous close of US$590.59.

The offering is at a discount of about 7.7% to Sandisk’s last closing price.

The sale is expected to impact Western Digital’s holdings in Sandisk, which it has previously invested in.

🔗 Source: Reuters

🧠 Food for thought

Implications, context, and why it matters.

Western Digital went beyond a stake in Sandisk. It agreed in 2015 to buy the company and closed the deal in 2016 through a cash-and-stock transaction initially valued at about $19 billion 1.
The latest sale follows Western Digital’s breakup into two public companies, finished on February 21, 2025. “Regular-way” trading started February 24, 2025. Western Digital kept hard disk drives, while Sandisk took flash memory 2.
Activist investor Elliott Management (a hedge fund known for pushing corporate restructurings) pushed the move. In 2022, it argued that a separation would unlock shareholder value 3.
Markets backed that argument. The two companies together reached about $22.55 billion in market capitalization the day after the breakup, up from about $17.94 billion before it 3.

The multi-billion dollar jump supports the activist view that focused tech businesses often earn higher valuations on their own 3.
That result gives shareholders at other diversified technology firms a playbook. Pressure may rise for companies with distinct units to separate.
As a standalone company, Western Digital can concentrate on AI and cloud data center storage demand through its hard drives 1.
Sandisk can steer through the flash memory market without ties to hard disk drives. It may appeal to investors seeking cleaner exposure to NAND/flash cycles (the boom-and-bust pricing swings typical in the flash memory market) 1.