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Seagate Takes Over Samsung's HDD for $1.375bn

It was just last month that Western Digital acquired Hitachi’s HDD unit for $4.3 billion, and now it looks as though Samsung and Seagate are teaming up to take on the newly strengthened WD. First rumored yesterday, Seagate’s $1.375 billion purchase of Samsung’s HDD division was confirmed early today. Half of the $1.375 billion price is to be paid in cash, while the remaining 50 percent will be paid in stocks.

Aside from combining the two companies hard disk drive divisions, the deal will also further extend the existing patent cross-license agreement between the two. Other elements of the deal include a NAND flash memory supply agreement that will see Samsung provide Seagate with semiconductor products for use in SSDs and hybrid SSDs; a disk drive supply agreement under which Seagate will supply disk drives to Samsung for PCs, notebooks and consumer electronics; a partnership between the two to co-develop enterprise storage solutions; and a shareholder agreement that will see a Samsung executive join the Seagate Board of Directors.

“We are pleased to strengthen our strategic relationship with Samsung in a way that better aligns both companies around technologies and products,” said Steve Luczo, Seagate chairman, president and CEO. “With these agreements, we expect to achieve greater scale and deliver a broader range of innovative storage products and solutions to our customers, while facilitating our long-term relationship with Samsung.”

“Delivering value to the market and consumers is the primary goal of the extensive agreement announced today. Samsung looks forward to extending our existing strategic ties with Seagate, to deliver creative technology solutions for a broad diversity of consumer, business and industrial applications,” said Oh-hyun, Kwon, president of the semiconductor business of Samsung Electronics.

Of course, the whole thing is subject to the usual red tape and regulatory approvals, so it won’t be signed and sealed for months. Seagate says it expects the deal to be closed by the end of the 2011 calendar year. 

  • cadder
    This is unfortunate- Seagate will pull Samsung's quality down to their levels.
    Reply
  • kcorp2003
    isn't Samsung the world's largest maker of memory chips? lol i wonder what interesting technology Seagate brought under its belt after buying out Samsung's HDD division.
    Reply
  • afrobacon
    First they take Maxtor from me, now Samsung. This is a bad day.
    Reply
  • springhalo
    "Half of the $1.375 million price is to be paid in cash"

    Isn't it supposed to be billion?
    As for the news, maybe HDD prices will decrease more as the competition increases between these two HDD giants.
    Reply
  • WR2
    Didn't WD take over Hitachi a while back?
    HDDs aren't on the way out but it won't happen anytime soon.

    Hopefully this won't mean the pricing trends turn around and performance improvements end.
    Reply
  • JMcEntegart
    SpringHalo"Half of the $1.375 million price is to be paid in cash"Isn't it supposed to be billion?As for the news, maybe HDD prices will decrease more as the competition increases between these two HDD giants.
    You're right, thanks!
    Reply
  • xFriarx
    afrobaconFirst they take Maxtor from me, now Samsung. This is a bad day.
    I agree. I had amazing luck with Maxtor and Samsung drives. I only had 1 Maxtor drive ever die on me and they RMA'ed with with a 30% larger drive. Seriously, I'm running out of HDD manufacturers to buy from. I hate WD (had at least 4 die) and loathe Seagate (every one my family or I has owned died).
    Reply
  • Anomalyx
    afrobaconFirst they take Maxtor from me, now Samsung. This is a bad day.Hey, the removal of Maxtor was a day to celebrate. I never had a Maxtor HD that lasted more than a couple months before failing catastrophically.
    Reply
  • plznote
    Aw, no Samsung's HDD's were the best.
    Reply
  • Anomalyx
    xfriarxI agree. I had amazing luck with Maxtor and Samsung drives. I only had 1 Maxtor drive ever die on me and they RMA'ed with with a 30% larger drive. Seriously, I'm running out of HDD manufacturers to buy from. I hate WD (had at least 4 die) and loathe Seagate (every one my family or I has owned died).Lol, we've had polar opposite experiences, apparently. Every Maxtor drive I've had always sucked, and every WD drive I've had has been wonderful. The few times a WD drive has failed on me, they've always sent me back a new one that was the next size up.
    Oh well, maybe the market is starting to balance out, and there are no longer "good vendors" and "bad vendors", and all are generally equal now.
    Reply