Seagate proposed $1 billion 900 million acquisition of the second half of next year to complete Maxtor

Beijing on December 21st news, according to foreign media reports, Seagate will buy Maxtor at a price of $1 billion 900 million, to further consolidate the status of the world's largest manufacturer of hard disk.

Seagate said in a statement, the company will buy Maituo stock according to the ratio of 0.37:1. According to the proportion of Seagate, Maxtor stock valuation of $7.25 per share, compared with Tuesday's closing price Maituo 60%. Seagate CEO Bill - (Bill Watkin), said: by expanding the size of the enterprise, we can reduce the overall cost, so as to more competitive prices to launch more innovative products."

Seagate expects that after the completion of the integration of the business, the company's first full fiscal year earnings per share will increase by 10% to 20%. The third quarter of this year, where a net loss of $17 million for the same period last year, a net loss of $95 million 100 thousand. Because of the problems in the process of production of factory of large capacity hard disk, Maxtor third quarter sales also fell. Affected by the news of the acquisition of Seagate, Maxtor shares Wednesday midday rose to $6.66, compared with Tuesday's closing price of $4.52 rose 47%. Seagate shares fell to $17.83, down $19.60 from Tuesday's closing price of $9%. As of Tuesday, Seagate's stock price has risen 13.5% this year, the company's market capitalization of $9 billion 400 million.

Seagate where the transaction is subject to regulatory and shareholder approval, is expected to be completed in the second half of 2006. If the transaction eventually canceled, Seagate needs to pay $300 million in damages to maxtor.