Seagate completes buyout of Samsung's HDD business


— 9:16 AM on December 20, 2011

Eight months after announcing plans to snatch up Samsung's mechanical storage business, Seagate has finally completed the $1.4 billion buyout. The deal is done, and the two companies' mechanical hard drive businesses are now under the same roof. Here's what the acquisition entails:

Under the terms of the transaction, Seagate has gained select elements of Samsung's HDD business, including assets, infrastructure and employees that enable Seagate to drive scale and innovation. These assets include Samsung's leading M8 product line of high-capacity, 2.5-inch HDDs. Samsung employees joining Seagate include a number of senior managers and design-engineering employees from Samsung's Korea facility, who will focus on development of small form-factor products for the mobile compute market. N.Y. Park, senior vice president and general manager, will oversee Seagate's product development activities in Korea and serve as country manager of the Korea design center, reporting to Bob Whitmore, Seagate's executive vice president and CTO.

Seagate says the buyout will "substantially expand" its presence in a number of regions, as well—China, Germany, Southeast Asia, and Russia. Also, Seagate and Samsung are going to deepen their collaboration. In Seagate's words, "The companies have . . . extended and enhanced their existing patent cross-license agreement and have expanded cooperation to co-develop enterprise storage solutions."

It's not clear exactly how Samsung's hard-drive lineup will be integrated into Seagate's. All Seagate says is that it plans to keep selling "certain" hard drives under the Samsung brand for the next 12 months. Perhaps some sort of assimilation, including re-branding of former Samsung products, will follow. I seem to recall Seagate keeping the Maxtor brand name alive long after acquiring that company in 2006, but Maxtor was a big player that enjoyed substantial name recognition; I don't think Samsung's former hard-drive wing belongs in the same category.

   
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