Western Digital receives $900 million in support during challenging market conditions
Major funds Apollo and Elliott have invested $900 million in Western Digital, which manufactures and develops computer electronics. The funds will enable the company to overcome the difficulties the sector is experiencing.
The funds bought preferred shares in the electronics manufacturer. In addition, one of the managing partners of Apollo will join the board of directors of Western Digital. It should be noted that the infusion of capital occurred during merger negotiations with the Japanese corporation Kioxia. Negotiations between the parties are still ongoing. According to preliminary agreements, the business of Kioxia will operate separately from the structure of Western Digital, but there will be a number of changes.
According to Bloomberg, the parties have developed a strategy whereby Western Digital will merge one of its units with Kioxia and become a separate company. The latter will operate in the United States. However, no official information has been received from the parties so far.
Western Digital was founded in 1970 in the United States and is headquartered in California. The company employs more than 500,000 people and has manufacturing facilities in Thailand and Malaysia and engineering centers in California. The company also has a network of offices in various countries.
The most popular products of Western Digital are network drives and hard drives. In 2023 the manufacturer introduced a new generation hard drive, which is the market leader in speed – 582 MB / s with a capacity of 20TB.
Western Digital holds a high position in the market, and an important role in this plays a strategy of business development based on mergers and acquisitions. In 2016, the company acquired SanDisk, a manufacturer of hard drives, the amount of the acquisition of the competitor amounted to $ 19 billion. Thanks to this transaction, Western Digital has strengthened its position in the market of flash memory devices and released two new product lines.
In 2017, the company acquired Toshiba’s semiconductor division. The deal took many months to negotiate, with the parties trying to find terms that would satisfy everyone. In the end, Toshiba’s business went to Western Digital for $17.3 billion.
In 2019, it became known that the company’s revenues decreased by more than $20 billion compared to the previous period. The reason for this is a decrease in demand for hard drives, as well as a decrease in sales of computer equipment. In order to optimize losses, in 2019 Western Digital stopped producing equipment for data centers and sold this business to DNN.
