CMC Magnetics Acquires Verbatim From Mitsubishi Chemical for $32 Million

End of historical power in storage media, like formerly Imation

This is a Press Release edited by StorageNewsletter.com on June 18, 2019 at 2:18 pm

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Mitsubishi Chemical Corporation (MCC) a parent company of Mitsubishi Chemical Media Co., Ltd. (MCM), announced an agreement to transfer its storage media business, including the optical disc, USB flash drives and other businesses globally operated by Verbatim group companies affiliated with MCM, as well as MCM’s related assets, to CMC Magnetics Corporation (CMC).

CMC, established in 1978, engages in the storage media, and is the world leading manufacturer in optical discs. It has established a solid partnership with MCC over a long period through licensing of technology for the optical disc, entrusted production, and so on.

While MCC has been moving to intensify the Mitsubishi Chemical Holdings Group’s business portfolio management based on the group’s medium-term management plan ‘APTSIS 20,’ CMC expects to enhance the storage media business not only through its own production technology, but also by building upon the MCC Group’s accumulated global sales network, technology, and so on, making the agreement advantageous to both parties.

Mitsubishi Chemical Media

Head office: 3-20, Kandaogawamachi, Chiyoda-ku, Tokyo

Representative: Masahiro Taguchi, president

Establishment: February 23, 1994

Capital: ¥4.09 billion

Consolidated net sales: ¥39.29 billion (fiscal 2018)

Employees: 215 including subsidiary group members

Business: Development and sale of CD-Rs/RWs, DVDs, BDs, etc., sale of USB flash drives, SD cards, magnetic tapes, peripherals such as external HDDs, and recording layer materials and stampers for optical discs, etc.

Comments

Old guys remember the fierce competition several decades ago between the top two WW leaders (with Sony), 3M and Verbatim, both of them with popular brand name and manufacturing and worldwide distributing about all the removable computer media (floppy, optical, tape).

3M, founded in 1902, introduced the first magnetic tape in 1947, the first QIC cartridge in 1971 and the 3.5-inch floppy disk in 1984

Imation was separated from 3M in 1996 and concentrates on data storage only, but lacked of ... imagination, signing a lot of acquisitions finally were a disaster.

In 2015, it acquired RDX then resold to Sphere 3D for $3 million, Connected Data for $7.5 million after exiting tape business, formerly Nexsan for $120 million in 2013 to finally sell it in 2017, small firm Nine technology in de-dupe, Prostor Systems in 2011 for $1 million, assets of MXI Security for $34 million, and encryptX the same year for $2.3 million, XtremeMac in 2008 for $9 million, assets of TDK in 2007 for $300 million, Memorex International in 2006 for $325 million, Memcorp's assets in 2007 for $60 million, assets of Emtec magnetics in 2003 for $15 million, and to finally disappears in 2017 after being controlled by activist investors Clinton Group.

The original Verbatim first started in Mountain View, CA, 40 years ago, under the name Information Terminals Corporation, founded by Reid Anderson. It became a leading manufacturer of floppy disks by the end of the 1970s, and was renamed Verbatim. In 1982 it formed a floppy disk joint venture with Japanese company Mitsubishi Kasei Corporation (forerunner of Mitsubishi Chemical Corporation), with the joint venture called Kasei Verbatim. Verbatim mostly struggled in the decade and was purchased by Eastman Kodak in 1985, while its floppy partnership with Mitsubishi Kasei Corporation was still intact. It was eventually purchased fully by Mitsubishi Kasei Corporation in March 1990, after 8 years in a joint venture, with the current company founded in 1994 reusing the brand name.

Verbatim HQs is in Charlotte, NC, with Europe ones in Eschborn, Germany, and AsiaPac ones in Hong Kong.

Originally an American company and well known for its floppy disks in the 1970s and 1980s, it now also produces USB drives, memory cards, HDDs, SSD), mobile accessories, LED lighting and 3D printing filaments.

Known acquisitions of Verbatim: Carlisle tape in 1992, Laser Technologies and Ecotone in 1995, SmartDisk in external HDDs in 2007, Freecom BV in external storage in 2009,.

CMC Magnetics just acquired Verbatim Storage Media Business from Mitsubishi Chemical for $32 million, according to a figure revealed by DigiTimes, with the deal to be finished by year-end 2019. It got the four Verbatim's subsidiaries based in the US, Europe, Australia and Hong Kong, as well as trademark, patents, technologies and retail channels. In 1998, CMC already acquired manufacturing technology of floppy disks and magnetic tapes from Verbatim, and two of its factories in California and Mexico.

Cmc

Established in 1978, CMC, headquartered in Taipei, Taiwan, now manufacturer of only optical discs (CD and DVD, not Blu-ray), after producing and then stopping floppy disk business, owns factories in Taiwan, China (Memorex, HP, Philips, TDK, Maxell) and Hong Kong (Memorex, Philips).

It owns two optical disc factories in Taiwan (Taoyuan City) and one in China (Nantong City, Jiangsu province). It also has affiliated companies in film, content, touch panel and restaurant industries.

In September 2001, it acquired for $3.3 million a subsidiary of Mitsubishi Chemical Company. In December 2015, Taiyo Yuden, one of the inventors of the recordable CD and inventor of the original cyanine dye for CD-R, sold its optical disc brand and intellectual property to CMC, ending its own production in Japan.

For the past 15 years CMC has produced hundreds of millions of discs for the most popular brands. It is especially the exclusive manufacturer and distributor for HP branded optical media worldwide. It states that it's the WW leader in OEM and private label media manufacturing.

CMC's consolidated revenues reached $21.9 million in May, growing 13.4% sequentially but down 6.1% Y/Y.

Read also:
Verbatim Sees Growth Opportunity in Optical Media Market
As Taiyo Yuden withdraws.
July 29, 2015 | Press Release
Verbatim Persists With Floppy Disk
Not like Sony
May 20, 2010 | Press Release
Freecom Acquired by Verbatim (MKM)
To increase its European market share in external storage devices [with our comments]
September 4, 2009 | Press Release