March 7, 2011 – Hitachi transfers hard disk drive business to Western Digital.
Western Digital will acquire all shares of Hitachi Global Storage Technologies’s holding company, Viviti Technologies Ltd. The proposed combination will result in customer-centric storage company, with significant operating scale, strong global talent and the industry’s broadest product lineup backed by a rich technology portfolio.
Under terms of the agreement, WD will acquire Hitachi GST for $3.5 billion in cash and 25 million WD common shares valued at $750 million, based on WD closing stock price of $30.01 as of March 4, 2011. Hitachi will own approximately ten percent of WD shares and hold two seats on the WD board of directors. Steve Milligan, president and chief executive officer of Hitachi GST, will join WD’s existing senior management team as president.
The acquisition of Hitachi GST is a unique opportunity for WD to create further value for our customers, shareholders, employees, suppliers and the communities in which we operate. 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. The skills and contributions of both workforces were key considerations in assessing this compelling opportunity. We will be relying on the proven integration capabilities of both companies to assure the ongoing satisfaction of our customers and to bring this combination to successful fruition.” – said John Coyne, president and chief executive officer of WD.
“This combination will bring together two industry leaders with consistent track records of strong execution and industry outperformance, together we can provide customers worldwide with the industry’s most compelling and diverse set of products and services, from innovative personal storage to Solid State Drives for the Enterprise.” – said Steve Milligan, president and chief executive officer, Hitachi GST.