Two of the largest NAND flash manufacturers are reportedly eyeing a major merger. Kioxia, formerly part of Toshiba, is said to be close to an agreement to merge with Western Digital to become a new SSD storage company to rival Samsung for the top market share.

According to Kyodo News, the two companies are expected to agree to the merger by the end of this month.

Western Digital shareholders will own 50.1% of the new company if the deal goes through. Kioxia will account for the remainder. However, Toshiba and SK Hynix will have a say in how the new company is formed. This is because Kioxia is an independent company from Toshiba's memory division and SK Hynix is an indirect investor.

According to Nikkei, WD and Kioxia have already secured $12.7 billion from Japanese investors to finance the merger.

You may not know much about the two companies, but WD currently makes our SSD of choice for gaming, the WD Black SN850X; Kioxia previously operated as Toshiba Memory Corporation, the company credited with inventing flash memory, but in 2019 the company name was changed to Kioxia.

The acquisition would create a mega-maker in the NAND manufacturing industry: according to TrendForce market research in early September, Samsung is the largest manufacturer of NAND flash, with 31.1% of the market; Kioxia is in second place, with 19.6%; and Western Digital is in third place, with 19.6% of the market. Western Digital is in fourth place with 14.7% of the market.

When you add up the market shares of Keoxia and WD, that's a whopping 34.3% of the market share held by a single company. This is more than the market leader, Samsung. [The merger of WD and Kioxia will make it easier for both companies to manage inventory and therefore pricing, although competition for the production of NAND flash storage used in SSDs is one of the reasons why SSDs are so cheap today. This is one of the reasons why SSDs are so cheap today.

If this deal gets the go-ahead from all parties involved, we will certainly hear from them by the end of this month. But that is far from the final approval required for the merger. Regulators have to give the deal the green light. If some country feels slighted by this proposed acquisition, it could get tricky.