The transaction involves 5.8 million Sandisk shares, which Western Digital is expected to exchange for debt held by affiliates of J.P. Morgan and BofA Securities. The two banks, serving as lead bookrunners for the offering, will manage the sale of the shares on behalf of their affiliates.
Sandisk shares fell roughly 2.13% in after-market trading on Tuesday following news of the planned sale, with Bloomberg News first reporting the price range of the offering.
After the transaction, Western Digital will retain a stake in Sandisk valued at nearly $1 billion, which the company has indicated it may dispose of in the future. Western Digital did not immediately respond to a request for comment from Reuters.
The move reflects the company’s strategy to unlock capital from its former subsidiary while managing its balance sheet and debt obligations.