SanDisk's stock jumped 11.22 percent on the rumor to $68.70 a share and is now trading at a market cap of $14.04 billion. Analysts believe a deal could make sense for WD as it would give the storage firm a strong foothold in the SSD market:
“We believe that Western Digital makes sense as an acquirer” at a total deal cost of about $15 billion, given the risk to the hard-drive market from flash memory, Deepon Nag, an analyst at Macquarie Group Ltd., wrote in a note to investors. A deal with Micron also make sense but could be complicated by a technology partnership it has with Intel Corp., Nag wrote.