Feeds

Seagate sucks up Samsung storage biz

Pays $1.375bn to boost market share to 40 per cent

Boost IT visibility and business value

Seagate is taking over Samsung's hard disk operation, in a deal that will give the Korean giant almost 10 per cent of the erstwhile storage market leader.

The deal had been expected, with Seagate CEO Stepehn Luczo having already cleared his calendar for a mysterious three-month sojourn in the Far East.

The combined business will take around 40 per cent of the worldwide HDD market, making it a much weightier counter to Western Digital/Hitachi GST's 50 per cent.

Under yesterday's deal, Samsung will "combine" its HDD business into Seagate's, extend the firm's patent agreements, and provide NAND flash to Seagate.

At the same time, Samsung will take Seagate drives for its PC, notebook, and crucially perhaps, consumer products.

In return, Samsung gets the equivalent of $1.375bn from Seagate, half in cash, and half in Seagate stock. The stock element amounts to 9.6 per cent of Seagate's equity, and is enough to earn Samsung a seat on Seagate's board.

Seagate said the deal will significantly expand its business in China and Southeast Asia. Presumably Luczo's Asian holiday will include a significant amount of handshaking with customers.

The deal was flagged yesterday by the Wall St Journal. Samsung had wanted as much as $1.5bn for the business, but it was thought it would settle for less than $1bn. As it is, it has gained a little more than that, albeit with an ongoing link to the hard drive business.

Seagate, for its part, may have paid slightly more than it would have liked, but will be hoping Samsung will lubricate its entry into China and other markets. ®

Boost IT visibility and business value

More from The Register

next story
Pay to play: The hidden cost of software defined everything
Enter credit card details if you want that system you bought to actually be useful
HP busts out new ProLiant Gen9 servers
Think those are cool? Wait till you get a load of our racks
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
Community chest: Storage firms need to pay open-source debts
Samba implementation? Time to get some devs on the job
Like condoms, data now comes in big and HUGE sizes
Linux Foundation lights a fire under storage devs with new conference
Silicon Valley jolted by magnitude 6.1 quake – its biggest in 25 years
Did the earth move for you at VMworld – oh, OK. It just did. A lot
prev story

Whitepapers

Gartner critical capabilities for enterprise endpoint backup
Learn why inSync received the highest overall rating from Druva and is the top choice for the mobile workforce.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Rethinking backup and recovery in the modern data center
Combining intelligence, operational analytics, and automation to enable efficient, data-driven IT organizations using the HP ABR approach.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.