Milipitas, Calif. memory chip maker SanDisk Corp.'s interest in expanding its product line clearly trumps fear of war in the Middle East. The maker of removable storage for cameras and other gadgets agreed to pay $1.55 billion in stock for Israeli peer Msystems Ltd. Although Msystems makes USB memory keychains and memory cards for cell phones, its bread-and-butter are hard drives that replace the mechanically driven platters with chips. Msystems' solid state hard drives are both faster and more durable than traditional hard drives making them popular for use in tanks and jet fighters. However, interest in these drives is expected to heat up in the consumer market as Samsung is expected to make similar drives available to consumers later this year. Perhaps Samsung's entry into the market for solid state hard drives propelled SanDisk's interest in Msystems. Of course, the Lexar-Micron merger may have also propelled SanDisk to pull the trigger on a deal. Or maybe SanDisk just wanted a piece of the defense business.
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