Global Sources
EE Times-India
Stay in touch with EE Times India
EE Times-India > Memory/Storage

WD to surpass Seagate with Hitachi merger

Posted: 10 Mar 2011     Print Version  Bookmark and Share

Keywords:acquisition  WD-Hitachi merger  disc drive industry consolidation 

"Near term, Seagate, Toshiba and Samsung will likely capture some redistributed market share, so the move is positive for them as well," he added.

WD will acquire Hitachi GST, a wholly-owned subsidiary of Hitachi Ltd, in a cash and stock transaction valued at approximately Rs.19,556.79 crore ($4.3 billion). The deal involves a combination of Rs.15,918.32 crore ($3.5 billion) in cash and 2.5 crore WD common shares valued at Rs.3,411.07 crore ($750 million), based on a closing stock price of Rs.1,364.88 ($30.01) on March 4. WD plans to fund the transaction with a combination of existing cash and total debt of approximately Rs.11,370.23 crore ($2.5 billion).

Hitachi Ltd will own approximately 10 per cent of WD shares outstanding after issuance of the shares and two representatives of Hitachi will be added to the WD board of directors. The transaction has been approved by the board of directors of each company and is expected to close during the third calendar quarter of 2011, pending regulatory approvals.

WD expects the transaction to be immediately accretive to its earnings per share on a non-GAAP basis, excluding acquisition-related expenses and restructuring charges.

The merged company will retain the Western Digital name and remain headquartered in Irvine, California. John Coyne will remain CEO of WD, Tim Leyden chief operating officer and Wolfgang Nickl chief financial officer. Steve Milligan, president and CEO of Hitachi GST, will join WD as president, reporting to John Coyne.

"We believe this step will result in several key benefits-enhanced R&D capabilities, innovation and expansion of a rich product portfolio, comprehensive market coverage and scale that will enhance our cost structure and ability to compete in a dynamic marketplace," said Coyne.

"Together we can provide customers worldwide with the industry's most compelling and diverse set of products and services, from innovative personal storage to solid state drives for the enterprise," said Milligan.

- Rick Merritt
  EE Times

 First Page Previous Page 1 • 2

Comment on "WD to surpass Seagate with Hitachi m..."
*  You can enter [0] more charecters.
*Verify code:


Visit Asia Webinars to learn about the latest in technology and get practical design tips.


Go to top             Connect on Facebook      Follow us on Twitter      Follow us on Orkut

Back to Top