Flash storage specialist SanDisk (NASDAQ: SNDK) announced today that investors have overwhelmingly approved of its proposed merger with Western Digital (WDC -3.15%) announced late last year. Of the total votes that were cast, 98% were in favor of the deal. Meanwhile, Western Digital shareholders have also approved of the merger, with over 90% of votes in favor.
All that's left is to obtain the final regulatory approvals in markets like China. The two companies have already received regulatory approvals in many other markets, including the U.S., Japan, and South Korea, among others. The deal is expected to close in the second quarter.
Does it matter?
The proposed merger makes sense for a number of reasons since Western Digital expects to generate significant cost synergies through the deal. The company estimates that it can achieve full annual run-rate synergies of $500 million within 18 months of closing. The merger should be accretive to adjusted earnings per share within a year.
While both companies are seeing growth decelerate in their core segments, merging and cutting costs can make that process more manageable while preserving profitability. The approvals have already been mostly priced in, so shares haven't moved much. But now comes the hard part of executing on the integration and realizing those synergies.