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A strategic partnership between
and
was announced in August 2010. Taking the partnership a
step ahead, Seagate is now about to takeover Samsung's hard disk
manufacturing and operations division globally for $1.38 bn. The
transaction was offered to Samsung comprising of 45.2 mn shares and
the remainder of the payment in a cash value of $687.5 mn. After
receiving the shares, the notebook major will become the second
largest shareholder of Seagate with a 9.6% stake in the company.
Under the terms of the agreement, Samsung will provide Seagate with
its premium NAND flash memory supply for use in Seagate's
enterprise solid state drives, solid state hybrid drives and other
products, while Seagate will provide with the HDD for the Samsung
range of laptops and desktops including consumer electronics. Also,
under the terms of agreement, Samsung has the right to nominate one
of its key personnel in Seagate's board of directors.
The deal is yet to get the approval by
the US court and related international judiciaries, Seagate partners
seem to have little to care about the 'global deal' with most of
them unaware of this fact. Neither Samsung nor Seagate has apparently
made any communication to its channel partners including its national
distributors in India. When contacted by The DQ Week, VK Bhandari,
director, Supertron Electronics, one of Seagate's NDs said, “I
have heard something about this acquisition, but there has not been
any official announcement from Seagate to the channels.” Also,
Ramesh Purohit of Omshakti Computers stated, “There has not been
any official communication from Seagate over this (deal) and I am
also not aware of it.” With most of the channel partners of Seagate
not intimated about this acquisition, either officially or in person,
some of the channel partners feel that there won't be much of an
impact on the Indian front. Speaking about the same, Ajay Kumar of
Venktron Digital Systems said, “There won't be any major effect
in the Indian market. If at all there needs to be any change in
either of the vendor's channel policy, it will come in by the end
of this CY.” However, according reports in the market, Samsung's
HDD shipments to India has been inactive for the past one and a half
quarters and there is negligible or no stocks with the Samsung HDD
distributors. “I think there is no stock of Samsung HDD with the
distributors. Acquisition of Samsung HDD (by Seagate) may be globally
beneficial for Seagate, but I doubt about any impact or changes in
India,” he added. Speaking on a similar tone, Asif Khan of
Technocrat Infotech said, “Samsung has diminutive presence in the
Indian HDD market. The agreement will obviously benefit Seagate as it
will increase its presence in the global markets.”
Prior to this deal, Western Digital had
also acquired the storage division of Hitachi and with this new
acquirement in place, global HDD shipments is expected to fall by
about 4%. “Acquisition is a global trend now and is acute in the
IT scenario. However, with two acquisitions occurring at a row this
year, the HDD market is poised to become more competitive,” Khan
added. At present, Western Digital accounts for 31% of global hard
drive shipments in the fourth quarter, followed by Seagate at 30%,
Hitachi at 18%, Toshiba contributing 11% and Samsung at the bottom at
10%.