Feeds

Fujitsu tells WD the deal's off

Zero chance of WD buying Fujitsu's hard drive business

Choosing a cloud hosting partner with confidence

Fujitsu did not give Western Digital a Christmas present - in fact it said 'No deal'.

The two companies have been talking about Fujitsu selling its loss-making hard disk drive business to Western Digital.

Fujitsu's president Kuniaki Nozoe said there was zero chance of a deal because Fujitsu wished to sell its Japan-based and overseas plants as a bundle with many workers keeping their jobs. It has not been able to agree with Western Digital how this could be done. A price of $550m has been mentioned by the Japanese Nikkei newspaper.

Western Digital traditionally does not comment on speculation or rumour about its activities. It is perhaps surprising that Fujitisu's president has commented in such clear cut terms about negotiations between his company and Western Digital. The negotiations between Fujitsu and Siemens over the purchase of Siemens' half share in the venture were not marked by such public comment by Fujitsu or Siemens about each other.

Since the deal between Fujitsu and Western Digital first become known, financial conditions have worsened. Western Digital is laying off workers, closing plants and reining in expenditure in response to the deepening recession. That obviously means it has fewer financial resources available for a purchase.

The yen:dollar conversion rate has changed and it will now cost more dollars to buy the Fujitsu HDD unit for the speculated 50bn yen price than it would a month or two ago. Fujitsu, having spent €450m (roughly 57bn yen at current conversion rates) buying Siemens' stake in FSC, may be finding it hard to lower its asking price for the HDD unit.

The logic of the deal in Western Digital gaining 2.5-inch disk drive market share and an enterprise disk offering is still valid. But this step forward in disk drive supplier consolidation looks to have stalled because Western Digital can't afford the price Fujitsu needs and can't afford to meet Fujitsu wishes concerning its HDD plants and workers. That is, unless the Fujitsu president's comments are a negotiating tactic to prod WD into offering more cash or finding some other way to consummate the deal. ®

Beginner's guide to SSL certificates

More from The Register

next story
NSA SOURCE CODE LEAK: Information slurp tools to appear online
Now you can run your own intelligence agency
Azure TITSUP caused by INFINITE LOOP
Fat fingered geo-block kept Aussies in the dark
Yahoo! blames! MONSTER! email! OUTAGE! on! CUT! CABLE! bungle!
Weekend woe for BT as telco struggles to restore service
Cloud unicorns are extinct so DiData cloud mess was YOUR fault
Applications need to be built to handle TITSUP incidents
BOFH: WHERE did this 'fax-enabled' printer UPGRADE come from?
Don't worry about that cable, it's part of the config
Stop the IoT revolution! We need to figure out packet sizes first
Researchers test 802.15.4 and find we know nuh-think! about large scale sensor network ops
SanDisk vows: We'll have a 16TB SSD WHOPPER by 2016
Flash WORM has a serious use for archived photos and videos
Astro-boffins start opening universe simulation data
Got a supercomputer? Want to simulate a universe? Here you go
Microsoft adds video offering to Office 365. Oh NOES, you'll need Adobe Flash
Lovely presentations... but not on your Flash-hating mobe
prev story

Whitepapers

Driving business with continuous operational intelligence
Introducing an innovative approach offered by ExtraHop for producing continuous operational intelligence.
Why CIOs should rethink endpoint data protection in the age of mobility
Assessing trends in data protection, specifically with respect to mobile devices, BYOD, and remote employees.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Reducing the cost and complexity of web vulnerability management
How using vulnerability assessments to identify exploitable weaknesses and take corrective action can reduce the risk of hackers finding your site and attacking it.