Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Western Digital and Kioxia speeding up merger talks amid weak industry trends - report

Published 15/05/2023, 12:02
Updated 15/05/2023, 12:02
© Reuters.

© Reuters.

Western Digital (NASDAQ:WDC) and Kioxia Holdings Corp are speeding up merger talks and discussing a deal structure as both companies continue to be pressured by a slump in demand for memory products, Reuters reports.

Excess inventory amid weak demand in the memory market hit both companies hard. The two companies believe that a single entity would be better positioned to compete against rivals, like Samsung Electronics (KS:005930).

The merged entity would be 43% owned by Kioxia, 37% by Western Digital, and the rest by existing shareholders of the companies, Reuters added.

Western Digital shares are up about 3% in premarket on the Reuters story.

The planned merger is likely to attract anti-trust scrutiny, likely in the United States and China.

Activist investor Elliott Management has a stake in WDC and is pushing for changes. On the other hand, Toshiba (TYO:6502) has a 40.6% stake in Kioxia. Elliott is also a shareholder of Toshiba.

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.