A must-read take on SanDisk’s acquisitions strategy – Market Realist

A must-read take on SanDisk’s acquisitions strategy – Market Realist




Acquisitions

“Big Data’s” arrival and the transition of enterprise preference from HDDs to SSDs is creating new opportunities in the flash memory and SSD space.

SanDisk (SNDK) is a pioneer in the flash memory, known globally for its portable USB storage devices. It wants to leverage this trend by making strategic acquisitions to grow its products and solutions portfolio.

EMC Corp. (EMC), through its 70 acquisitions since 2003, IBM (IBM), and Microsoft (MSFT) are spending billions on acquisitions. This shows that acquisitions appear to be a preferable route for enhancing their offerings.

SanDisk is keen on expanding its presence in the enterprise SSD market. This market has faster growth potential than existing consumer flash or HDD markets.

A must-read take on SanDisk’s acquisitions strategy

The chart above shows the gigabyte and revenue demand expected in enterprise and client SSDs in the coming years.

Strategic acquisitions to expand SanDisk’s presence in the enterprise storage space

Including Fusion- io, SanDisk has, to date, made five acquisitions in the enterprise storage space. It purchased SMART Storage System, an enterprise-grade SATA and SAS SSD storage system developer, in July 2013 for $307 million. This acquisition was instrumental in its expanding enterprise portfolio and data center space. SanDisk, while catering to the consumer segment, faces stiff price competition. With smart storage products that cater to enterprise, cloud deployments, and the defense and industrial industries, SanDisk planned to combine its SAS products that are preferred by storage OEMs.

The company acquired Schooner, an SSD-optimized software developer, in June 2012. This helped it expand in the enterprise software market.

In February 2012, it acquired Flashsoft, a flash memory company whose software targets Windows, Linux, and VMware (VMW) platforms. This acquisition helped SanDisk extend its enterprise SSD solutions portfolio.

In May 2011, SanDisk acquired Pilant Technology, an enterprise SSD developer, for $327 million. This move was in accordance with SanDisk’s move to enter into the enterprise SSD market.

Fusion-io acquisition

In June 2014, SanDisk acquired Fusion-io for $1.1 billion. This is expected to strengthen its presence in enterprise storage.






SNDK

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