Western Digital and Hitachi Global Storage Technologies have announced a deal that will see Toshiba acquiring the 3.5-inch hard disk drive manufacturing equipment and IP Western Digital now holds. These 3.5" HDDs are used in desktop computers in all sorts of consumer electronic devices such as DVR's and more. Toshiba acquiring the WD manufacturing gear and IP is part of the mutual agreement for property divesting between the two firms.
Toshiba is also taking over Western Digital's near-line storage for server applications. Western Digital on the other hand will acquire Toshiba Storage Device Co Limited, which is Toshiba's wholly-owned HDD manufacturing subsidiary located in Thailand. That includes the principal assets, physical property, facilities, and workers. Operations at that facility are primarily for 2.5-inch HDD's used in laptops. This particular facility is currently not in operation due to the flooding inside Thailand.
The deal is incomplete at this point and requires regulatory approvals before it finishes. Both companies expect the deal to be approved and finalized by the end of March. It's interesting that Western Digital is buying a facility that is still closed due to flooding. I wonder if the facility has any damage and if that will affect the transaction at all.
"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," Toshiba said in a statement.