Monday, December 2nd 2013

OCZ Reaches Agreement With Toshiba to Acquire Solid State Drive Business

OCZ Technology Group, Inc., a leading provider of high-performance solid state drives (SSDs) for computing devices and systems, today announced that the Company has signed an asset purchase agreement with Toshiba Corporation, a global technology leader and manufacturer of NAND flash memory, to acquire substantially all of OCZ's assets in a chapter 11 bankruptcy proceeding for $35M.

Under this agreement Toshiba will acquire OCZ's client and enterprise solid state drive business. OCZ will continue to operate and serve existing and future customers during this process. Toshiba has agreed to provide the Company with DIP (Debtor-in-Possession) financing to ensure that there is adequate capital and flash supply to support the business during the contemplated sale period. The consummation of the asset purchase agreement is subject to an auction and approval by the bankruptcy court in the Company's bankruptcy case.

This acquisition will provide Toshiba with access to OCZ's proprietary controllers, firmware and software, as well as the teams responsible for bringing these solutions to market, in addition to OCZ's established brand and sales channels. This strategic opportunity will bring critical controller IP and NAND supply all under one global organization, allowing for an even more robust and competitive solid state solution offering for all of OCZ's and Toshiba's mutual customers moving forward.

"Over the past year, OCZ has dealt with numerous issues which have stressed the company's capital structure and operating model, posing a challenge to achieving near term profitability. The combination of NAND flash supply constraints and credit issues have impacted our ability to satisfy the demands of our customers; this combined with increased pricing pressure in our industry have contributed to our on-going operating losses. On an operational basis, we completed a complex investigation, several restructurings and a multi-year restatement that added significantly to our working capital requirements," stated Ralph Schmitt, CEO of OCZ. "We have been working diligently on this partnership with Toshiba and we believe that this is the best outcome under our current corporate conditions."

"We are excited to participate in this opportunity. If our bid is successful, the combination of our leading NAND technology with OCZ's SSD expertise will allow us to further strengthen Toshiba's SSD business," said Mr. Seiichi Mori, Vice President of Toshiba's Semiconductor and Storage Company and Corporate Vice President of Toshiba. "We value OCZ's SSD business and technology in both the consumer and enterprise markets, and we are confident that it will reinforce our capabilities and help us to secure leadership in the SSD market."

This transaction has been approved by the Board of Directors of OCZ, and it is expected that the sale will close within approximately 60 days.
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9 Comments on OCZ Reaches Agreement With Toshiba to Acquire Solid State Drive Business

#1
LagunaX
So what happens to the OCZ stock?
Posted on Reply
#2
FreedomEclipse
~Technological Technocrat~
LagunaX said:
So what happens to the OCZ stock?
business as usual till all stock is bought, recycled or put into landfill. Toshiba will transfer and honor all warranties - or at least they should do.

More importantly though, whats gonna happen to OCZ's PSU division I wonder. They can either break away from OCZ and attempt to float themselves to the top or hold out for a buyer to show.

Id say this is a good chance for BeQuiet! to step in and save them, BeQuiet! already makes PSUs but their distribution can be rather poor depending on region, with OCZ/PC Power & Cooling they will gain all their distributors.
Posted on Reply
#3
urza26
Will all new SSD's henceforth be named using Toshiba's namescheme? Since the Vertex and Agility range got a bit of bad taste to it. I got no personal experience with them, but people tend skip a product when it has a bad name (eventhough it might be unfairly so).
Posted on Reply
#4
lZKoce
This could come out pretty nicely. Toshiba has been having some value offers to cover for the more budet-minded people. I hope now after the acquisition, they would be able to consume the new knowledge properly and really do strengthen their postitions.
Posted on Reply
#5
FreedomEclipse
~Technological Technocrat~
urza26 said:
Will all new SSD's henceforth be named using Toshiba's namescheme? Since the Vertex and Agility range got a bit of bad taste to it. I got no personal experience with them, but people tend skip a product when it has a bad name (eventhough it might be unfairly so).
I cant see why they wouldnt want to phase out OCZ's naming scheme
Posted on Reply
#6
ssdpro
I have always had a lot of faith in OCZ - technology was good and their support was a bit better than the rest. This seems to be a big win. Customers will get their warranties honored (bankruptcy court will see to that) and OCZ will have resources. Not sure if they keep the OCZ name or convert to Toshiba though. Will it follow the "Crucial by Micron" model or just absorb after a year or so soak time. One thing OCZ always whined about was NAND supply, which was probably true - they had to go around begging the big boys for scraps. Now the big boy will own them and they get all the want.
Posted on Reply
#7
shilka
FreedomEclipse said:
business as usual till all stock is bought, recycled or put into landfill. Toshiba will transfer and honor all warranties - or at least they should do.

More importantly though, whats gonna happen to OCZ's PSU division I wonder. They can either break away from OCZ and attempt to float themselves to the top or hold out for a buyer to show.

Id say this is a good chance for BeQuiet! to step in and save them, BeQuiet! already makes PSUs but their distribution can be rather poor depending on region, with OCZ/PC Power & Cooling they will gain all their distributors.
Be Quiet does not make any of the PSU´s they sell

They are a mix of HEC / Seasonic and FSP
Posted on Reply
#8
HisDivineOrder
Well, this is a great deal for Toshiba to get Indilinx. Everyone serious in SSD's wants to have their own proprietary controller they own.

And this is theirs.

We should see an interesting price war of Samsung and Toshiba now. This is probably the best way this could have ended.
Posted on Reply
#9
FreedomEclipse
~Technological Technocrat~
HisDivineOrder said:
Well, this is a great deal for Toshiba to get Indilinx. Everyone serious in SSD's wants to have their own proprietary controller they own.

And this is theirs.
semi true - Toshiba are said to have used their own in house controllers though have never revealed to reviewers what it is they actually use. Some reviewers suspect that Toshiba used marvell controllers which have appeared on many SSDs - even some of Crucial's top of the range SSDs.

What SSD Controller Toshiba use is nothing but speculation and rumors floating around, though their buying up of OCZ for assets could mean that maybe they WERE running with a marvell controller
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