Wednesday, February 29th 2012

Toshiba Acquires WD HDD Manufacturing Equipment and Transfer of HDD Manufacturing

Toshiba Corporation (TOKYO:6502) today announced that it has entered into a definitive agreement with Western Digital Corporation (NYSE: WDC) on Toshiba's acquisition of certain of Western Digital's 3.5-inch HDD manufacturing equipment and related intellectual property, and the transfer to Western Digital of Toshiba Storage Device (Thailand) Co., Ltd. (TSDT), Toshiba's wholly-owned HDD manufacturing subsidiary located in Thailand.

Toshiba and Western Digital aim to complete the acquisition and transfer by March of this year after obtaining approval from the relevant authorities. Under the agreement, Toshiba will acquire the following equipment and intellectual property from Western Digital.
  • Manufacturing equipment for 3.5-inch HDDs for use in desktop PCs and other consumer applications, plus related intellectual property; and
  • Manufacturing equipment for near-line HDDs for server applications.


Toshiba also has agreed to transfer to Western Digital its entire shareholding in TSDT.
Toshiba's acquisition of assets from Western Digital and the transfer of TSDT to Western Digital are subject to Western Digital's completion of its pending acquisition of Hitachi Global Storage Technologies and regulatory approvals from the relevant antitrust authorities.

The global market for HDD and other storage devices is expected to see sustained demand growth, driven by the continued diversification of devices requiring storage, including PCs, tablets and smartphones, and the explosive increase in data storage and archiving that will accompany cloud computing.

Toshiba acquired Fujitsu Limited's HDD business in 2009, expanding its product portfolio of small form factor HDDs for mobile applications with Fujitsu's enterprise HDDs. Since then, the company has developed a line-up of storage products for enterprise applications. More recently, in July 2011 Toshiba unified the Semiconductor Company and the Storage Products Company, covering NAND flash memories, SSDs and HDDs, and is now positioned to carry out coordinated sales promotions to a wide range of customers.

The purchase of part of Western Digital's 3.5-inch HDD manufacturing equipment and with it the capability to produce 3.5-inch HDDs for desktop PCs, DVR and other consumer applications, will expand Toshiba's portfolio and enable the company to supply products covering all segments of the HDD market. It will also expand Toshiba's supply capacity in the market for near-line HDDs, which is expected to expand with the continuing growth of the server market, further reinforcing a strategic segment of the company's HDD business.

Toshiba will transfer the shares of TSDT to Western Digital and consolidate HDD production at its two HDD manufacturing facilities in the Philippines and a contract manufacturer in China. A key goal is to further enhance cost competitiveness by boosting manufacturing efficiency.

Following the reinforcement of its HDD businesses through this re-organization, Toshiba aims to establish itself as the leading provider of integrated storage solutions–the company that has all three key storage solutions: NAND flash, SSD and HDD.
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11 Comments on Toshiba Acquires WD HDD Manufacturing Equipment and Transfer of HDD Manufacturing

#1
btarunr
Editor & Senior Moderator
Posted on Reply
#2
Completely Bonkers
Come one, Do we need two news postings about the same news? One from the perspective of Toshiba, the other from WD? Is news that slow today?
Posted on Reply
#3
Super XP
Toshiba, Leading Innovation. :D
Posted on Reply
#4
wiak
by: Completely Bonkers
Come one, Do we need two news postings about the same news? One from the perspective of Toshiba, the other from WD? Is news that slow today?
its called press release news day :p
Posted on Reply
#5
wiak
by: wiak
its called press release news day :p
by: Super XP
Toshiba, Leading Innovation. :D
the secound time i read that it translates to Toshiba Leaving Innovation :roll:
Posted on Reply
#6
Red_Machine
Wait. So Toshiba's buying equipment and patents from WD so they can manufacture hard drives again, but they're selling Toshiba Storage Device Ltd. to WD? They're gaining the ability to make hard drives, but selling their hard drive company?

Does. Not. Compute.
Posted on Reply
#7
Completely Bonkers
by: Red_Machine
Does. Not. Compute.
Option 1
Tax.accounting trick. They'll swap licenses, do reverse buy-backs, write-off goodwill, account for goodwill, make real costs become exceptional reorganisation costs etc.etc. Then sell buy-back next year. So much window dressing of the books everyone will be obconfuzsaskatedized!

Option 2
PR fail. Someone typoed big time

Option 3
Strategic mixup and no-one noticed yet. Oh shit. Heads will roll.
Posted on Reply
#8
Red_Machine
by: Completely Bonkers
Option 3
Strategic mixup and no-one noticed yet. Oh shit. Heads will roll.
I'd so lol if it was this.
Posted on Reply
#9
suraswami
ok now I am confused. Which HDD I am buying, WD or Hitachi or Samsung or Seagate? Who owns what?
Posted on Reply
#10
hellrazor
This either going to be really funny or really bad.
Posted on Reply
#11
pabag
Toshiba great going, suddenly I see Toshiba everywhere. They seem to be on a killing spree.
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