Proactiveinvestors USA & Canada Western Digital https://www.proactiveinvestors.com Proactiveinvestors USA & Canada Western Digital RSS feed en Wed, 19 Jun 2019 17:56:29 -0400 http://blogs.law.harvard.edu/tech/rss Genera CMS action@proactiveinvestors.com (Proactiveinvestors) action@proactiveinvestors.com (Proactiveinvestors) <![CDATA[News - Western Digital Inc, Intel Corp and HP Inc - AFTER HOURS ]]> https://www.proactiveinvestors.com/companies/news/181645/western-digital-inc-intel-corp-and-hp-inc-after-hours-181645.html Serial company crusher Meg Whitman has stepped down as chairperson of fading computer giant HP Inc (NYSE:HPQ).

She has been succeeded by the appropriately named Chip Bergh, the chief executive of jeans maker Levi Strauss.

Whitman, who was in charge of online auction giant eBay when it wasted billions of dollars buying loss-making Internet phone call firm Skype, only to find the company she had bought did not own the technology behind its flagship product.

Her stint at HP was noticeably no more successful, with the company wasting US$11bn on the acquisition of British technology company, Autonomy.

The company wrote down the value of its investment by US$8.8bn, alleging that about US$5bn of that write-down was due to alleged “improper accounting” by the British company.

In other tech news, computer storage device giant Western Digital Corp (NASDAQ:WDC) posted fiscal fourth quarter earnings per share of US$2.93, up 187.3% from US$1.02 in the corresponding period of last year.

Revenue rose 38.3% to US$4.84bn from US$3.50bn a year earlier.

The shares were off 5% at US87.35 in screen-based trading.

Computer chip leviathan Intel Corporation (NASDAQ:INTC) – known as Chipzilla by computer geeks – saw its net income rise 20.7% to US$3.5bn in the second quarter of 2017 from US$2.9bn the year before.

That was equivalent to 72 cents per share (2016: 59 cents), and four cents above the market consensus.

Revenue rose 9.6% to US$14.8bn from US$13.5bn.

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Fri, 28 Jul 2017 08:01:00 -0400 https://www.proactiveinvestors.com/companies/news/181645/western-digital-inc-intel-corp-and-hp-inc-after-hours-181645.html
<![CDATA[News - Toshiba suing Western Digital over sale of memory chip business ]]> https://www.proactiveinvestors.com/companies/news/179982/toshiba-suing-western-digital-over-sale-of-memory-chip-business-179982.html Toshiba is suing Western Digital Corp (NASDAQ:WDC) 120bn yen for allegedly interfering in the sale of its memory chip business.

The final stages in the sale of the chip unit were disrupted after Western Digital and US private equity group KKR resubmitted their bid for the business.

Toshiba accused Western Digital of “continually interfering with the bid process”. The Japanese tech giant also claimed that Western Digital will face antitrust issues if it buys the business since it already owns Sandisk.

The company had been closing in on a final deal to deal the division to its preferred bidder, a consortium of Japanese government-backed fund and Bain Capital.

Toshiba had told shareholders it expected to have a deal in place by today. But the group said it failed to complete the agreement, said to be worth US$18bn, after Western Digital got involved.

Western Digital, which jointly runs Toshiba's main semiconductor plant, is opposed to the deal with the consortium  and has been at loggerheads with its Japanese partner. The US firm has sought a US court injection to prevent any deal that does not have its consent.

As part of Western Digital’s offer, it will provide debt financing to facilitate the sale of Toshiba’s 50.1% interest in the memory chip joint venture.

Toshiba is selling the unit to cover huge losses in its US nuclear division.  Last week the firm said 2016 losses may be greater than it had previously forecast on the back of financial struggles at the nuclear business.

It expects a net loss of 995bn yen for the year to March, compared to its earlier estimate of 950bn yen.

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Wed, 28 Jun 2017 13:59:00 -0400 https://www.proactiveinvestors.com/companies/news/179982/toshiba-suing-western-digital-over-sale-of-memory-chip-business-179982.html
<![CDATA[News - Western Digital’s Toshiba talk back on agenda following after stock drop ]]> https://www.proactiveinvestors.com/companies/news/179892/ Data storage group’s Western Digital Corp (NASDAQ:WDC) and Seagate Technology Plc (NASDAQ:STX) have been on the back-foot since Monday’s regular trading closed after the former changed guidance for the fourth quarter, but takeover talk on Tuesday promised a quick change of subject.

Western Digital has reportedly submitted a new bid for Toshiba’s flash memory business, with the revised offer pitched at US$18bn. It is the latest twist in an ongoing spat between the two groups which jointly operate a memory manufacturing plant in Japan.

On Monday, after market hours, Western Digital upgraded earnings expectations for the fourth quarter, with the company saying flash memory and hard drive sales were up, but, revenue guidance remains unchanged and gross margin is higher.

WDC dropped 2.22% since Monday’s close, trading at US$90.60, while Seagate slumped 1.75% to US$41.65.

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Tue, 27 Jun 2017 07:13:00 -0400 https://www.proactiveinvestors.com/companies/news/179892/
<![CDATA[News - Western Digital raises targets after acquisition of memory card-maker SanDisk ]]> https://www.proactiveinvestors.com/companies/news/163604/western-digital-raises-targets-after-acquisition-of-memory-card-maker-sandisk-163604.html Western Digital Corp (NASDAQ:WDC) raised its revenue and earnings targets for the September quarter after the recent acquisition of memory card maker SanDisk.

The California-based company has moved into flash-storage technology as disk-drive sales dwindle.

The SanDisk acquisition was closed in May, bringing in more customers and a broader portfolio of hard-drive and flash-storage products.

The group now sees revenue for the three months to September to reach between US$4.45bn and US$4.55bn, compared with the previous forecast of US$4.4bn to US$4.5bn.

An improved product mix and pricing is expected to help expand adjusted gross margins.

Western Digital expects to earn between US$1 and US$1.05 a share, compared with its earlier estimates of between US$0.85 and US$0.90 a share.

Full results will be reported late October.

Last year the group announced a US$19bn cash-and-stock deal to buy SanDisk, where sales of enterprise solutions and removable products have been rising.

In July, Western Digital posted a quarterly loss on costs associated with the integration of SanDisk, but results were nonetheless higher than expected.

SanDisk pushed up total sales 9.5% during the quarter.

Shares in Western Digital rose 5.5% to US$50.15 in premarket trading.

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Wed, 07 Sep 2016 14:33:00 -0400 https://www.proactiveinvestors.com/companies/news/163604/western-digital-raises-targets-after-acquisition-of-memory-card-maker-sandisk-163604.html
<![CDATA[News - Western Digital agrees to buy SanDisk for $19bn ]]> https://www.proactiveinvestors.com/companies/news/116487/western-digital-agrees-to-buy-sandisk-for-19bn-116487.html Western Digital (NASDAQ:WDC), a hard-disk drive maker, agreed to purchase SanDisk (NASDAQ:SNDK), a maker of flash memory storage chips, for about $19bn, or $88.50 per share in cash and stock.

SanDisk's shares rose only 3% to $77.47 at 10:02 a.m. in New York. Shares of Western Digital, meanwhile, gained 3.9% to $77.84.

The value of the SanDisk acquisition will depend on the closing and approval of an investment from a unit of China's state-backed Tsinghua Holdings, Unisplendour in Western Digital, the companies said in a statement on Wednesday.

"The combined company will be ideally positioned to capture the growth opportunities created by the rapidly evolving storage industry," Western Digital CEO Steve Milligan said in a written statement.

Milligan will serve as CEO of the combined business, which will keep its headquarters at Western Digital's Irvine, California location.

The semiconductor industry has seen a record number of transactions this year as demand for cheaper chips and products to power Internet-connected gadgets push technology companies to consolidate suppliers.

The deal is expected to add to Western Digital's adjusted earnings within the first 12 months of its closing.

The company said it expected to enter into new debt facilities totalling $18.4bn, including a $1.0bn revolver, a portion of which will be used to fund the deal.

The deal is expected to close in the third calendar quarter of 2016.

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Wed, 21 Oct 2015 10:14:00 -0400 https://www.proactiveinvestors.com/companies/news/116487/western-digital-agrees-to-buy-sandisk-for-19bn-116487.html
<![CDATA[News - Western Digital gains as China loosens restrictions on Hitachi Global takeover ]]> https://www.proactiveinvestors.com/companies/news/116372/western-digital-gains-as-china-loosens-restrictions-on-hitachi-global-takeover-116372.html Western Digital (NASDAQ:WDC) rose in morning trades after China loosened some restrictions on the disk-drive maker’s acquisition of its competitor Hitachi Global Storage Technologies Ltd.

Shares rose 1.8% to $80.93 at 9:44 a.m. in New York, paring this year’s loss to 27%.

China’s commerce ministry said on Monday that it would now allow the Irvine, California-based company and Hitachi Global Storage to combine their manufacturing and research operations, although they must maintain separate sales and branding for at least two years.

It said that Western Digital may reapply for combined sales and branding in two years.

The decision comes less than a month after Western Digital agreed to sell a 15% stake for $3.78bn to an arm of Chinese state-owned tech investment firm Tsinghua Unigroup Ltd. Zhao Weiguo.

Western Digital said it anticipates to save $400mln a year on its operating expenses, while reaping additional savings in the cost of goods sold. The company estimated it would take one to two years to achieve most of these savings.

"The decision announced today positions us for continued growth and long-term value creation," Western Digital CEO Steve Milligan said in a statement on Monday.

“HGST and WD are an exceptional combination, and together, we will set the pace for innovation in this dynamic and evolving industry."

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Mon, 19 Oct 2015 13:25:00 -0400 https://www.proactiveinvestors.com/companies/news/116372/western-digital-gains-as-china-loosens-restrictions-on-hitachi-global-takeover-116372.html
<![CDATA[News - Western Digital to sell 15% stake to China’s Unisplendour for $3.78bn ]]> https://www.proactiveinvestors.com/companies/news/115897/western-digital-to-sell-15-stake-to-chinas-unisplendour-for-378bn-115897.html Western Digital (NASDAQ:WDC) surged in early trading after the U.S. data storage company said Chinese state-backed Unisplendour Corp Ltd would invest $3.78bn in the company for a 15% stake.

The Irvine, California-based company will issue new shares to Unisplendour at $92.50 each, a 33.3% premium to Western Digital's Tuesday close.

The shares soared as much as 13% as of 8:20 a.m. in New York. The stock had closed up 1.6% at $69.37 on Tuesday, paring this year’s retreat to 37%.

Under the agreement, Unisplendour will have the right to nominate one representative to Western Digital's board, the companies said in a statement on Wednesday. 

Western Digital said the investment will help improve growth as the global data-storage industry changes.

U.S. and European technology companies have grappled to get customers in China after former U.S. National Security Agency contractor Edward Snowden's revelations of cyberspying program involving U.S. firms.

Many companies are looking for local partners in China or seeking to sell off some assets to Chinese buyers. 

 

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Wed, 30 Sep 2015 08:41:00 -0400 https://www.proactiveinvestors.com/companies/news/115897/western-digital-to-sell-15-stake-to-chinas-unisplendour-for-378bn-115897.html
<![CDATA[News - Western Digital shares rise 8% on accelerated dividend ]]> https://www.proactiveinvestors.com/companies/news/91727/western-digital-shares-rise-8-on-accelerated-dividend-38249.html  

 

Western Digital (NASDAQ:WDC) shares advanced to close nearly 8 per cent higher on Wednesday after the hard-disk drive maker announced an accelerated cash dividend of 25 cents for the quarter ending December 28. 

The dividend will be dished out on December 26, to the company's shareholders of record as of December 14. 

 

In September, the company said that beginning in fiscal year 2013, it is targeting a return to shareholders of around 50 per cent of its free cash flow through a mix of cash dividends and share buybacks. 

In late October, the company said its fiscal first-quarter net income more than doubled thanks to the acquisition of a data storage unit of Hitachi earlier this year.

For the three months that ended September 28, net profit rose to $519 million, or $2.06 per share, compared to $239 million, or $1.01 per share, a year earlier. Excluding items, earnings came in at $2.36 per share, beating the the $2.29 per share expected by analysts according to FactSet.

Revenue rose 50 per cent to $4.04 billion, higher than the $3.98 billion expected by analysts.

 

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Wed, 05 Dec 2012 15:48:00 -0500 https://www.proactiveinvestors.com/companies/news/91727/western-digital-shares-rise-8-on-accelerated-dividend-38249.html
<![CDATA[News - Western Digital Q1 beats Street but storage device sales slow ]]> https://www.proactiveinvestors.com/companies/news/90626/western-digital-q1-beats-street-but-storage-device-sales-slow-36361.html

Hard drive maker Western Digital Corp. (NASDAQ:WDC) late Monday said fiscal first-quarter net income more than doubled thanks to the acquisition of a data storage unit of Hitachi earlier this year.

For the three months ended September 28, net profit rose to $519 million, or $2.06 per share, compared to $239 million, or $1.01 per share, a year earlier. Excluding items, earnings came in at $2.36 per share, beating the the $2.29 per share expected by analysts according to FactSet.

Revenue rose 50 per cent to $4.04 billion, higher than the $3.98 billion expected by analysts.

"We are pleased to deliver another quarter of strong financial performance, continuing our track record of consistent execution," Western Digital's CEO John Coyne said. 

"While the macroeconomic environment is dampening near term demand, we remain confident in the continued long-term growth in the creation, storage and management of digital content. Western Digital has never been better positioned to address this opportunity, with great people, deep technology, a broad product portfolio and strong customer and supplier relationships."

Coyne's outlook highlights a slowdown in sales of storage devices to data centers and enterprise customers. Strong growth in this business, which accounts for a third of the company's sales, has so far outweighed a slump in sales to PC makers.

Western Digital signaled weakness in its enterprise business last month when it lowered its revenue outlook, spooking investors and prompting a slew of estimate revisions from analysts.

Tablets have been cannibalizing PC sales and Intel's (NASDAQ:INTC) lackluster outlook last week dispelled lingering hopes for a revival by year-end.

Western Digital said it expects second-quarter adjusted earnings of $1.65 to $1.85 per share on sales of between $3.55 billion and $3.7 billion. Analysts were expecting a profit of $2.40 on revenue of $4.08 billion, according to Thomson Reuters.

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Tue, 23 Oct 2012 08:23:00 -0400 https://www.proactiveinvestors.com/companies/news/90626/western-digital-q1-beats-street-but-storage-device-sales-slow-36361.html
<![CDATA[News - Western Digital cuts Q1 outlook, boost share buyback ]]> https://www.proactiveinvestors.com/companies/news/89582/western-digital-cuts-q1-outlook-boost-share-buyback-34728.html

Hard drive maker Western Digital Corp. (NYSE:WDC) late Thursday cut its revenue outlook for the fiscal first quarter, at the same time starting a quarterly dividend and boosting its share buyback authorization by $1.5 billion.

The world's largest hard drive maker has seen muted demand for its products. The company, which competes against Seagate Technology (NASDAQ:STX), said it expects industry demand of 140 million hard drives in the September quarter, down from its earlier forecast of 157 million units.

Western Digital said its board of directors has approved an additional $1.5 billion share buyback and it will start a quarterly dividend of 25 cents per share payable on October 15.

Western Digital expects revenue of $3.9 billion to $4.0 billion for its first quarter ending September 28, down from its prior forecast of $4.2 billion to $4.3 billion.

Analysts on average were expecting revenue of $4.29 billion, according to Thomson Reuters. The company expects adjusted gross margin of about 30 percent in its first quarter.

The company has benefited recently from its $3.4 billion acquisition of Hitachi's hard drive operations. It has also seen a boost from its recovery from severe flooding that occurred in Thailand late last year.

In July, Western Digital posted third-quarter earnings of $745 million, or $2.87 per share, compared to a $158 million profit, or 67 cents per share, in the prior year period.

Removing acquisition and restructuring-related costs, the company earned $3.35 a share, compared to 81 cent per share in profit a year earlier.

Sales, for the quarter that ended June 29, came in at $4.8 billion, up from the $2.4 billion recorded a year prior.

Analysts polled by Bloomberg expected a per-share profit of $2.49, on $4.2 billion in revenue for the latest quarter.

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Fri, 14 Sep 2012 08:50:00 -0400 https://www.proactiveinvestors.com/companies/news/89582/western-digital-cuts-q1-outlook-boost-share-buyback-34728.html
<![CDATA[News - Western Digital shares soar after Q4 profit surges and sales pop ]]> https://www.proactiveinvestors.com/companies/news/88229/western-digital-shares-soar-after-q4-profit-surges-and-sales-pop-32500.html Western Digital Corp.’s (NASDAQ:WDC) stock popped in pre-market trade Thursday after releasing fourth-quarter financial results that smashed analyst estimates.

The external storage and router maker reported profits stood at $745 million, or $2.87 per share, compared to a $158 million profit, or 67 cents per share, in the prior year period.

Removing acquisition and restructuring-related costs, the company earned $3.35 a share, compared to 81 cent per share in profit a year earlier.

Sales, for the quarter that ended June 29, came in at $4.8 billion, up from the $2.4 billion recorded a year prior.

Analysts polled by Bloomberg expected a per-share profit of $2.49, on $4.2 billion in revenue for the latest quarter.

Shares, in pre-market trade, jumped 17.40 per cent to $38.12 apiece on the Nasdaq on Thursday morning.

"While responding to two major natural disasters and completing the largest acquisition in the history of the industry," chief executive John Coyne said in a statement, "we achieved year-over-year sales growth of 31 per cent and more than doubled earnings per share."

Following the floods in Thailand, a shortage of hard drives led to a spike in prices last year.

Western Digital also acquired Hitachi Ltd's hard drive business for $4.3 billion in 2011.

The Irvine, California-based tech company shipped 71 million hard drives in its final quarter. That is up from the 53.8 million hard drives it shipped last year.

Gross margin widened sharply to 30.9 per cent from 19.5 per cent in the same period of 2011.

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Thu, 26 Jul 2012 09:10:00 -0400 https://www.proactiveinvestors.com/companies/news/88229/western-digital-shares-soar-after-q4-profit-surges-and-sales-pop-32500.html
<![CDATA[News - Western Digital Q2 earnings beat estimates ]]> https://www.proactiveinvestors.com/companies/news/83063/western-digital-q2-earnings-beat-estimates--23915.html Hard drive maker Western Digital (NYSE:WDC) posted fiscal second-quarter sales that topped analyst predictions due to "substantial progress" in its recovery from flooding in Thailand that hit production.

Sales for the three months ended December 30 fell 19 percent to $2 billion in the three months ended December 30. The results topped a $1.84 billion average estimate, according to Bloomberg. Net income fell 36 percent to $145 million, or 61 cents per share.

Western Digital's president and chief executive officer John Coyne said: "We have made substantial progress in restoring WD's manufacturing capabilities in the aftermath of the historic flooding in Thailand, and this is reflected in our second quarter financial results and in the resumption of our operations there."

The hard disk manufacturer believes capacity will be back to pre-flood capabilities in the quarter ending in September 2012.

In October, the company forecast a loss of between $1.50 and $1.10 per share, below analysts' expectations at the time. Last month, Western Digital raised its revenue prediction to at least $1.8 billion.

Gross margin for the period widened to 32.5 percent from 19.2 percent as hard drive shipments decreased 45 percent to 28.5 million units.

In December, Western Digital said it restarted production at a facility in Thailand a week ahead of schedule. Like many tech companies, Western Digital had suspended operations in Thailand, the second-largest producer of hard-disk drives after China and a major supplier of hard drive parts, as rising water flooded facilities.

Western Digital's earnings had slumped in the last fiscal year on aggressive price cuts and complications following the March earthquake disaster in Japan, which had delayed shipments to some key customers. However, the company's first-quarter profit rose as margins improved.

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Tue, 24 Jan 2012 07:58:00 -0500 https://www.proactiveinvestors.com/companies/news/83063/western-digital-q2-earnings-beat-estimates--23915.html
<![CDATA[News - Western Digital resumes partial Thailand production, shares up 12% ]]> https://www.proactiveinvestors.com/companies/news/81902/western-digital-resumes-partial-thailand-production-shares-up-12-21953.html Computer hard drive maker Western Digital (NYSE:WDC), the worst hit hard drive manufacturer by Thai floods, said it has resumed partial production at its Thailand operations.

Western Digital's shares were up 12 percent to $32.88 Friday morning.

The company also warned of tighter global supply until the early part of 2012.

Western Digital president and chief executive officer, John Coyne, said: "The passion, perseverance, ingenuity and execution exhibited by the WD team has been extraordinary and enabled us to make substantial progress in partially restoring our operations in Thailand, well in advance of our earliest expectations when the floods hit."

Thailand produces around half of global hard drives produced by PC component makers such as Western Digital, Seagate (NASDAQ:STX), Toshiba and Hitachi.

Western Digital, whose production facilities in Thailand's Ayutthaya and Pathum Thani provinces were severely hit by floods, forecast $1.8 billion in fiscal second-quarter revenue, higher than the $1.2 billion analysts predicted, according to Thomson Reuters.

Gross margin is also seen above the high end of its previous range of 18 to 23 percent for the quarter ending in December, the company said.

"The company believes that significant industry supply constraints will continue in the March quarter and beyond," Western Digital said in a statement.

Western Digital expects global hard drive output shortages to amount to 60 million units in the second quarter, as supplies are seen at 120 million units, well short of estimated demand of between 170 and 180 million units.

Western Digital expects to take a flood-related charge of $225-$275 million, excluding any insurance recovery, in the second quarter.

The company also expects to file a property damage claim of at least $50 million and an additional claim for business interruption during the second quarter.

Research firm IHS iSuppli said the Thai floods will shrink global hard drive supply by 30 percent in the current quarter, and hit sales of PCs and semiconductors, affecting core businesses of the likes of Samsung Electronics, Lenovo and Hewlett-Packard (NYSE:HPQ).

With operations disrupted at more than a dozen hard drive factories, damage to the industry is significant and PC shipments may be crimped by as much as a fifth in the first three months of 2012, hurt by the shortage of hard drives, research firm IDC said.

Western's competitor, Seagate, said earlier this week that revenue for the current quarter would come in at $2.8 billion, better than market expectations, as its own shipments are expected to fall by 16 percent from the previous quarter to 43 million units.

Seagate's Thai plants are largely unaffected by the floods, but production has been hit as key suppliers have seen their operations flooded.

Last week, Western Digital secured conditional approval from the European Union's competition regulator to purchase Hitachi's HDD business for $4.3 billion, after it agreed to sell several production operations. However, the company still needs to sell more assets to get full regulatory approval.

The company said it was working to satisfy provisions necessary for the transaction, which it expects to close by March 2012.

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Fri, 02 Dec 2011 10:53:00 -0500 https://www.proactiveinvestors.com/companies/news/81902/western-digital-resumes-partial-thailand-production-shares-up-12-21953.html
<![CDATA[News - Western Digital's Thailand production facilities affected by flooding ]]> https://www.proactiveinvestors.com/companies/news/80513/western-digitals-thailand-production-facilities-affected-by-flooding-19572.html Hard drive maker Western Digital (NYSE:WDC) announced Wednesday it expects production in the current quarter to be adversely affected by the severe flooding in Thailand.

The flooding has caused issues with infrastructure in the region, including transportation and utilities, and has resulted in the inundation of some supplier facilities.

However, Western Digital reported that its approximate 37,000 Thailand-based employees are safe at this time.

Western Digital also said its facilities in Thailand remain operational, though production has been temporarily suspended as a safety measure for its employees and as a preventative measure regarding damage to equipment.

As the flooding continues and conditions continue to evolve, the company said it is unable to fully determine the impact on its operations at this time. It will provide further updates during its conference call, scheduled for October 19, it added.

In the quarter that ended July 1, the company shipped about 54 million hard drives from its facilities in Thailand and Malaysia, with approximately 60% of those shipped from its Thailand locations.

Some 2.3 million people have been, in some way, affected by what reports are calling the worst flood season to hit Thailand in 50 years, the company said.

Based in Lake Forest, California, Western Digital makes hard drives and solid state drives for the collection, management, and use of digital information.

In New York, its shares shed 4.5% to $27.58 as of 3:14 pm EDT.

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Wed, 12 Oct 2011 15:37:00 -0400 https://www.proactiveinvestors.com/companies/news/80513/western-digitals-thailand-production-facilities-affected-by-flooding-19572.html
<![CDATA[News - Western Digital to acquire Hitachi's data storage unit in $4.3bn deal ]]> https://www.proactiveinvestors.com/companies/news/76565/western-digital-to-acquire-hitachis-data-storage-unit-in-43bn-deal-12784.html Western Digital (NYSE:WDC) said today it has agreed to buy Japanese Hitachi's (NYSE:HIT) (TSE:6501) data storage products unit in a cash and stock deal valued at $4.3 billion.

"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 Western Digital president and CEO John Coyne.

Under the terms of the deal, Western Digital will acquire Hitachi Global Storage Technologies (GST) for $3.5 billion in cash and 25 million Western Digital shares valued at $750 million, based on the company's Friday closing price.

After the deal is complete, Hitachi will own roughly 10% of Western Digital, and two representatives of the company will be added to Western Digital's board.

The enlarged entity will retain the Western Digital name and will remain based in Irvine, California with Coyne as CEO. President and CEO of Hitachi's GST unit, Steve Milligan, will come on as president of Western Digital.

The transaction, which has already been approved by both boards, is expected to close in the third quarter this year. Western Digital said it expects the acquisition to be immediately accretive to its earnings per share on an adjusted basis.

Western Digital plans to fund the purchase with a combination of cash on hand, and total debt of approximately $2.5 billion.

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Mon, 07 Mar 2011 15:40:00 -0500 https://www.proactiveinvestors.com/companies/news/76565/western-digital-to-acquire-hitachis-data-storage-unit-in-43bn-deal-12784.html