Samsung had previously offered to buy Sandisk for $5.85 billion to bolster its own flash memory production. However, according to InfoWorld, the deal is seen to be rejected by federal regulators for fear that the combined power of Sandisk and Samsung would thwart competition, leading to possible higher prices for consumers and corporate buyers. Samsung initially wanted to buy Sandisk so that it could be a dominant player in flash memory production.

Flash memory is seen in memory cards, as internal components in handheld devices like the Samsung Omnia and music players like the iPod and iPhone, in laptops as solid-state storage drives, and in cameras and other electronics.

Samsung is already the leading manufacturer of flash memory. Last year, Samsung and Sandisk provided over 50% of the world’s flash memory.