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Seagate Acquires Rival Hard Drive Maker, Maxtor

by Rainier on May 17, 2006 @ 8:07 p.m. PDT

Seagate Technology Maxtor Corporation announced today that their shareholders have approved the previously announced definitive merger agreement under which Seagate will acquire Maxtor in an all stock transaction.

With all required regulatory and shareholder approvals now secured, it is expected that the transaction will close in 2-3 business days and that Maxtor shares will cease to be listed on the New York Stock Exchange before the market opens on Monday, May 22, 2006.

"Seagate has approached this transaction much differently than traditional mergers and acquisitions. This combination will deliver greater scale by leveraging Seagate's successful business model and is not intended to be a traditional integration of product lines or operations," said Bill Watkins, Seagate's President and CEO. "The acquisition of Maxtor will further build on Seagate's foundation as the premier global hard disc drive company and strengthens our ability to drive future growth by providing enhanced operating scale and key resources to fuel product innovation, maximize efficiency and realize significant cost benefits. The scale gained with this acquisition is needed to meet the world's growing demand for sharing and storing digital content. Seagate's continued investment in burgeoning markets like Consumer Electronics and Branded Solutions, as well as our core computing markets, has seen our product set grow from eight to 30 products over the last three years and is now on pace to reach almost 50 products over the next two years. Leveraging increased scale with Seagate's successful product platform strategy, we believe the combined company is best-positioned to deliver to global customers a more compelling, diverse set of products at more competitive prices, to meet the growing demand for storage."

The approvals were obtained at special meeting of Seagate shareholders and an annual meeting of Maxtor stockholders, held by each company earlier today. Under the previously announced terms of the transaction, Maxtor stockholders will receive 0.37 shares of Seagate common stock for each Maxtor share they owned at the closing.

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