SanDisk (SNDK) reached an agreement with Toshiba to sell about 30% of the current manufacturing capacity of the companies' joint ventures to Toshiba.

In a press release Monday, SanDisk said the move would "significantly reduce SanDisk's capital spending, further strengthen its balance sheet and reduce NAND flash memory production commitments."

SanDisk expects to receive cash and reduce equipment lease obligations by about $1 billion through the transaction.

SanDisk and Toshiba will continue to be equal partners for the roughly 70% capacity of the fabs that remain in the joint ventures. SanDisk expects the transaction to be completed in the first quarter.

SanDisk is trying to fend off a hostile takeover offer from Samsung. Samsung has offered to buy SanDisk for $26 a share, a price well above the company's share price in September when the offer was made, but a steep discount from SanDisk's 52-week high of $55.98.

SanDisk shares closed Friday at $15.51.

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