The EU has said Western Digital can buy the Hitachi GST disk drive business but only if it sells off some 3.5-inch drive production capacity to an EU-approved buyer. The $4.3bn purchase of Hitachi GST, recently renamed Viviti Technologies, is conditional "upon the divestment of essential production assets for 3.5-inch hard disk …
Please excuse my ignorance, but why does the EU have a say over a merger between an American and a Japanese company? Is it that if they're not happy they will not allow drives from the new company to be sold in the Eurozone?
... WD still has any HDD production capacity?
Is Mr Almunia not referring to the enterprise market when he says restoring competition? Your own article admits that Toshiba is a fringe player in enterprise, and if I'm not mistaken Samsung was as well. Which means only Seagate, WD and Hitachi GST were competing properly for the enterprise market. So if Toshiba bought the assets, and took on Hitachi's current position, does that not make 3 becoming 3?
not a problem
sell the flooded plant in Thailand to somebody for a buck, and use the facilities that formerly-hitachi wanted to dump. note how they renamed global storage technologies as soon as a merger appeared possible?
oh, and the EU gets a say because if you don't get their OK, your products don't sell there. no pressure.
Is it so bad
Thai plant is under water, so wait until water goes back and sell it to the other party, with a fix from the insurance.
Either that or have some old production kit moved there and the nice new shiny better kit put in at another factory which they will keep.
In effect they sell some old plant that's getting on a bit to another company for not too much and get to upgrade somewhere on the back of the insurance for the thai floods.
Licence of the IP should bring them in a fair amount of money longer term too I would have thought.
So even less competition in the hard drive market, with Seagate trying to snap up Samsung drive business, we will be left with two, Seagate rubbish and WD. as bad as the video card market and the CPU market.
maths is not my strong point
but I cannot work out how two companies merging reduce the competition by two, surely it would be just one. So either there were only four companies before the seagate-samsung merger not five, or there is another competitor besides the three mentioned.
Apart from which, I'm sure the WD spinoff will be a bargain basement price, same as all of Honda's water logged cars in Thailand being sent for scrap.
Maybe that's the point
Tell them they have to sell to an approved bidder. No approved bidder turns up. Can't takeover Hitachi business. Competition restored.
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