SAN FRANCISCO (MarketWatch) -- Samsung Electronics said late Tuesday that it has offered to acquire SanDisk Corp. for about $5.85 billion, capping several days of speculation about a potential combination of the two companies.

In a letter to SanDisk, Samsung said it was reiterating a previous offer to buy the company for $26 per share in cash, in a deal that would not be contingent to financing arrangements.

But SanDisk SNDK rejected the deal in its own statement Tuesday.

SanDisk Chief Executive Eli Harari said that Samsung's acquisition offer "does not provide appropriate value to our stockholders and is opportunistically timed at the trough of an industry-wide downturn."

Samsung had said in its letter that it's "deeply disappointed" that SanDisk "continues to cling to unrealistic expectations on both its standalone market value and an appropriate merger price." The letter said the two companies have been in talks for the past four months.

Shares of SanDisk surged more than 50% in after-hours trading on Tuesday, to $22.85. The stock had closed the regular session up 4.4% at $15.04.

The offer represents a premium of 93% over the price of SanDisk's shares before rumors of a potential merger began to drive up the stock earlier this month. On Sept. 4, Samsung SSNLF, issued a statement saying it was considering an alliance with SanDisk, but no decision had yet been made. See full story.

However, the offer is about half the stock's value at this time last year. SanDisk shares have been on a sharp decline, as a glut of supply in the flash memory market has led to a sharp drop in earnings. SanDisk swung to a loss of $67.9 million during the second quarter as sales declined, with the company blaming a "rapid deterioration in consumer confidence" during the period. See full story.

SanDisk makes flash-memory products used by a large variety of consumer electronics devices, such as MP3 players, digital cameras and cell phones. Samsung is one of the world's largest manufacturers of flash memory chips.

In its letter, Samsung noted that the "competitive environment remains challenging," and that combining the two companies would put the business in a better position to survive any slowdown and gain additional market share.

Samsung said it went public with its offer after becoming "increasingly concerned that the lack of progress is not serving the interests of either company's shareholders. For this reason, and the fact that speculation has grown since the early September news reports, we feel compelled to clarify our intentions publicly."