Western Digital to Acquire Hitachi

Western Digital will acquire Hitachi Global Storage Technologies (Hitachi GST), a subsidiary of Hitachi Ltd. which manufactures products and solutions to storage (storage media).

The transaction value in cash and shares worth about 4.3 billion U.S. dollars. Each cash transaction at 3.5 billion U.S. dollars plus 25 million shares of WD $ 750 million U.S. dollars, based on WD's closing stock price of 30.01 U.S. dollars as of March 4, 2011.

Hitachi, Ltd. will retain about 10 percent of Western Digital shares outstanding after the issuance of shares, and two representatives from Hitachi will be placed in the board of directors of WD. The transaction was approved by the board of directors of both companies and is expected to be completed in the 3rd quarter of calendar year 2011, which still must meet various requirements in the usual, including approval from regulators.

The combined company still uses the name of Western Digital and headquartered in Irvine, California. John Coyne will remain as chief executive officer of WD, Leyden team as chief operating officer and Wolfgang Nickl as chief financial officer. Steve Milligan, president and chief executive officer of Hitachi GST will join the WD as the president and responsible for John Coyne.
"We believe that this step will produce a number of benefits of key-capabilities of R & D is better, innovation and expanding product portfolio is rich, market reach a comprehensive and scale that will improve our cost structure and ability to compete in a dynamic market," said John Coyne, president and chief executive officer of WD in the press release.

Combined the two companies will produce a storage company to a customer focus, with significant operating scale, strong global talent and the industry's largest product line is supported by a very rich technology portfolio.

Meanwhile, Hitachi will be more focus on Social Innovation Business, including information and telecommunications systems, power systems, environmental systems, industrial and transportation, and social and urban systems, as well as advanced materials and various primary devices that support them.