Western Digital in joint push with Unisplendour to sell arrays in China

Commerce is a many-splendoured thing

Following Unisplendour’s intended $3.8bn investment in Western Digital, the two companies are forming a joint venture to sell WD’s data centre arrays in China.

According to analyst haus Stifel Nicolaus' MD, Aaron Rakers, this JV will be 49 per cent owned by Western Digital and 51 per cent by Unisplendour and its subsidiary Unissoft (Wuxi) Group. It should be based in China and become operational by the second 2016 calendar quarter.

The array in question is HGST's Active Archive system.

The Unisplendour investment in Western Digital has to permitted by CFIUS, the US Treasury Department’s Committee on Foreign Investment in the United States. It is hoped this occurs by April 2016.

Unisplendour is owned by the Tsinghua Unigroup, which is involved with China’s memory chip-making ambitions.

Rakers points out that Unisplendour bought a 51 per cent interest in an HP Enterprise business called H3C back in May. This is HP’s China-based server, storage and technology services operation. It was a Huawei-3Com joint-venture set up in 2003 to sell networking kit into China. Huawei’s interest was bought out by 3Com in 2007, and then HP bought 3Com in 2009. It subsequently looked to sell the H3C business but the JV carries on HP’s interest. Unisplendour paid $2.3bn for its 51 per cent.

Unisplendour's parent, Tsinghua Unigroup, is becoming a powerhouse, an octopus with many tentacles, in the Chinese storage market. Intel, Western Digital and HP are now involved with it. As for Western Digital, there many be opportunities to add SanDisk's all-flash Intelliflash array to the JV's product portfolio. The Jade Kingdom must look like a golden opportunity. ®

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