JCET and Western Digital (WD) agreed on an equity purchase agreement, under which the former will acquire most of the stake in the latter's data storage subsidiary in China, solidifying its status in the OSAT business and expanding its share in the data storage industry.
On March 3, WD filed an 8K form saying SanDisk China, a subsidiary of WD, will sell to JCET a majority of the equity interest in SanDisk Semiconductor Shanghai (SDSS). JCET will acquire 80% of the equity interest of SDSS for about US$624 million, with the remaining owned by SanDisk China. The transaction with payment to be made over five years is expected to be completed in the third quarter of 2024.
On the other hand, JCET issued a corporate filing on March 5, confirming the planned transaction. The corporate filing cited WSTS data saying that storage chip is the second-largest market in the semiconductor industry, accounting for 28%, and its market size will reach US$130 billion in 2024 globally, with NAND flash accounting for about 40%.
JCET said in the corporate filing that the company has been in close ties with WD since 2003. The Shanghai-based SDSS is engaged in advanced flash storage packaging and testing, providing iNAND flash memory modules and MicroSD components used in telecommunications, automobiles, and consumer devices.
JCET said the transaction will help the company establish a closer strategic partnership with WD and enhance customer stickiness. Furthermore, it will expand the company's market share in the storage and computing electronics field, enhance intelligent manufacturing, and create a competitive advantage through differentiation.
JCET said after the completion of this transaction, the seller and its affiliates will continue to be the main or sole customers of the target company for some time.
Chinese media Cailian, citing industry insiders, reported that with the continued growth of the global storage and NAND Flash market, JCET is expected to further consolidate its position in the semiconductor packaging and testing field through this transaction and expand the company's product range and market opportunities.
