Feb 18 (Reuters) – Western Digital is planning to raise $3.17 billion by selling a part of its stake in flash memory unit Sandisk, which it used to own, as the hard disk drive maker looks to reduce debt.
The secondary share sale, announced by Sandisk on Wednesday, is priced at a 7.7% discount to the company’s last closing price and involves swapping 5.8 million shares for debt held by affiliates of J.P. Morgan and BofA Securities.
Following the share sale, Western Digital’s stake in Sandisk will be reduced to about 1.7 million shares, which is worth nearly $1 billion, according to Reuters calculations.
Western Digital intends to sell the rest of the shares eventually, with an aim to reduce its debt pile of $4.69 billion as of January 2026.
Sandisk shares fell about 3% in premarket trading on the news, while Western Digital rose nearly 2%.
Western Digital completed the spinoff of Sandisk last year, and has been streamlining its business to become a pure-play HDD firm.
Last month, the company forecast quarterly revenue above Wall Street estimates, as the rapid growth of artificial intelligence technologies and hyperscaler efforts to scale up AI infrastructure fuel robust demand for its products.
Sandisk last month had also forecast quarterly results above estimates, driven by a surge in demand for its data storage products.
(Reporting by Kritika Lamba and Rajveer Singh Pardesi in Bengaluru; Editing by Mrigank Dhaniwala and Janane Venkatraman)
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