Now, It’s Toshiba in Talks to Buy Fujitsu’s HDD Ops

After WD finally out of the game

This is a Press Release edited by StorageNewsletter.com on January 14, 2009 at 3:39 pm

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Toshiba says in talks to buy Fujitsu’s hard-disk ops

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Now, it’s Toshiba that wants to get the loss-making hard disk drive operations of Fujitsu after WD finally decided to end talks to acquire them.

Look at our article:
WD to Acquire Fujitsu HDD Business?

The price of the deal is supposed to be between $340 million and $350 million for Toshiba, much less that $660 million to $943 million reported by the Nikkei Business Daily for WD. This difference can be explained since Toshiba only wants to get the two Fujitsu’s HDD assembly sites in Navanakorn, Thailand and Calamba Laguna, Philippines, and not the Nagano plant in Japan where it produces components.

Toshiba is manufacturing 1.8-inch and 2.5-inch HDDs, with quite a part of its notebook devices for its own portable computers.

Fujitsu is involved in 2.5-inch notebook units and enterprise HDDs.

But we don’t see the interest of Toshiba to enter into high-end HDDs, for three reasons:

the demand is stable and even going down,
the competition is strong (Seagate and Hitachi GST), and
Toshiba has a poor knowledge of the OEMs and the distribution in this sector.

Wait so see if Toshiba will pursue Fujitsu’s enterprise HDD activity.

If the deal between the two Japanese companies is done, they will represent the number three maker of HDDs – all drives included - behind Seagate and WD, with about the same output as Hitachi GST. In notebook units only, they will take the second place after WD, but this time surpassing Seagate and HGST, according to the 3Q08 figures of TrendFocus.

The consolidation of the HDD sector will then continue with only six manufacturers remaining in this industry, four from Asia, and two from the U.S.: ExcelStor, HGST, Samsung, Seagate, Toshiba and WD.

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