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Fujitsu looking to sell hard drive unit

Sale is on again

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It's on again. After rumours of Fujitsu wanting to sell its hard disk drive business to Western Digital surfaced and sank a few weeks ago, the mooted sale is on again.

The Wall Street Journal is reporting that Fujitsu is talking to several interested parties about buying its HDD unit. Western Digital is reckoned to be the front runner.

Referring to the HDD unit, Fujitsu chief financial officer Kazuhiko Kato said: "If we keep it as it is, losses from that business will grow." A Fujitsu spokesperson in Japan said: "Certain businesses are under review. The hard drive business unit is one of these. We're in discussion with certain parties and no decisions have been made."

Fujitsu is the sixth-largest supplier of HDDs with a 6.6 per cent market share and revenue of ¥333bn ($3.1bn) in 2007. Seagate (no. 1), Western Digital (no. 2) and Hitachi GST (no. 3) are the only profitable hard drive manufacturers. Toshiba, Samsung and Fujitsu are all reckoned to have loss-making hard drive operations.

Fujitsu manufactures a range of 2.5-inch SATA mobile drives, 40-320GB in capacity with a 500GB model announced. It also has a range of 3.5-inch enterprise drives with both Fibre Channel, SAS-1 and SAS-2 interfaces with both 10,000 and 15,000 rpm models and a 73-300GB capacity range. These would provide Western Digital with an instant entry into the enterprise hard drive space where it lacks product currently, although it does rate some of its SATA drives as enterprise-class.

Fujitsu also has a portable external drive offering, a 160-500GB USB-2 unit, which could be absorbed by Western Digital's extensive line of Passport drives.

Western Digital makes a wide range of external drives, consumer drives, drives for gaming workstations and and desktop and notebook drives. The bulk of its offering uses the SATA interface with SAS rumoured to be coming. It has no Fibre Channel drive and this SAS and FC lack makes Fujitsu's HDD operation an attractive fit at first glance.

Fujitsu has agreed to buy out Siemens' half share in the Fujitsu Siemens Computers European servers to desktops to storage business for €450m. A sold HDD unit should generate capital which would help defray the FSC half share purchase. ®

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