SanDisk Buys Matrix

Online staff -- Electronic News, 10/21/2005

A move into the 3D IC market by SanDisk Corp. will cost it $250 million as the storage media giant plans to acquire Matrix Semiconductor Inc.
 
Matrix is a privately held company based in Santa Clara, Calif., that has been developing and supplying 3D IC one-time programmable (OTP) technology since its inception in 1998. Because OTP technology is not rewritable once programmed, it complements rather than directly competes with flash memory, which is rewritable but more costly and SanDisk’s prime market. 3D memory is often used for storage applications that do not require multiple rewrites and where low cost is the top consideration, such as video games, music and archiving.

“Use of the Matrix 3-D Memory extends beyond video games and hopefully will play an important role in content distribution such as incorporation in our recently launched Gruvi cards for secure distribution of premium music titles and other preloaded content in handsets," said Eli Harari, CEO of SanDisk, in a statement Thursday.

The acquisition consideration will be approximately $250 million, consisting of $238 million of newly issued SanDisk shares and equity incentives and $12 million of cash. The companies expect to complete the acquisition by the end of 2005. SanDisk said it intends to support and sell Matrix's 3D OTP products through its various sales channels and will work closely with Matrix's customers to assure continuity of supply during the transition.

SanDisk also reported Thursday that revenues hit a record $590 million in Q3, a 45 percent year-over-year increase and 15 percent sequential increase.