DailyTech - Seagate's Acquisition of Maxtor to Finalize Soon

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Hardware Seagate's Acquisition of Maxtor to Finalize Soon
Purav Sanghani - May 17, 2006 11:39 PM

18 comment(s) - last by Madellga.. on May 18 at 3:29 PM

Maxtor will be but a distant memory in just a few days and the name thrown into Seagate's closet of conquests

In a matter of days we will never see the Maxtor name on the New York Stock Exchange again as shareholders of Seagate Technology and Maxtor Corporation have approved the acquisition of all of Maxtor's assets by Seagate. Under the agreement shareholders of Maxtor stock will receive 0.37 shares of Seagate stock for every share of Maxtor stock they own. Seagate issued the following statement in a press release today:

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 Technology made the initial announcement of the merger late December 2005 for a $1.9B USD buyout and at that point it was just a matter of time before things were finalized between the two organizations.

The merger will transfer over Maxtor assets such as its media facilities which are said to be ready for manufacturing perpendicular magnetic recording media as well as any products Seagate feels would be a great addition for generating revenue. Seagate has also hinted that the Maxtor acquisition may not be the last it makes and we are looking forward to what the hard drive giant has up its sleeves.

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Maxtor Sux

By Shenkoa on 5/18/2006 1:29:00 AM , Rating: 2

I hope this does not make Seagate suck like Maxtor.

Maxtor makes subpar quality HDD's

RE: Maxtor Sux

By shadowzz on 5/18/2006 1:32:10 AM , Rating: 2

Seagate's drives are my favorite bar none. Long live Seagate.

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RE: Maxtor Sux

By Stele on 5/18/2006 5:00:34 AM , Rating: 3

I agree with you to a certain extent... other than occasional star performers like the DiamondMax Plus 40, D740X and MaxLine III, Maxtor's IDE/SATA drives have been mediocre at best, subpar at worst during the past few years. And not just in performance but sometimes in reliability too - had quite a few Maxtor drives of various models just fail on my friends and I out of the blue, at work and at home.

Beyond that, I respectfully beg to differ with your generalisation that Maxtor makes subpar quality HDDs. Their Atlas SCSI HDDs have consistently been at the forefront of the genre, sporting excellent performance and reliability - especially in server environments, where they truly shine.

For us here (myself, friends, company, clients) Seagate, on the other hand, has served slightly different needs - their HDDs are generally chosen by those who like the 5-year warranty and/or the very low noise profile (both of which Seagate still leads). However, while their Cheetah 10K and 15K SCSI HDDs are superb - neck to neck with the Atlas' - their SATA/IDE drives have generally been very average and sometimes even lackluster performers.

As such, while neither company's prodcts are perfect, they don't all 'suck' either.

Just my 2 cents' ;)

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RE: Maxtor Sux

By Samus on 5/18/2006 5:22:43 AM , Rating: 2

You might not realize, Maxtor doesn't make the Atlas, Quantum does.

Before you point out Maxtor purchased Quantum some years ago, the same engineering team works on the products. Maxtor's sole interest in aquiring Quantum was for their SCSI line. They let their IDE line around the 60GB mark.

However, some Quantum technology surfaced in the 740 line (mainly controller optimizations and 100MHz 'MaxCache')

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RE: Maxtor Sux

By Stele on 5/18/2006 9:50:58 AM , Rating: 4

I'm well aware of the Maxtor-Quantum relationship, but thank you anyway :) The D740X was most noteworthy because of the incredible similarity in the HDD cover to the Quantum Fireball, except that the whole assembly was rotated 180° with respect to the power/data interface side. Quite a departure from the then-traditional Maxtor, both in looks and performance as it turned out thanks to the imported technology as you rightly noted.

I agree with you that the same engineering team worked on Atlas from Quantum to Maxtor. However, whether or not this is the case doesn't change the bottomline fact that the HDDs are all branded Maxtors. There isn't a "Maxtor built by Quantum" line of HDDs any more than there is a "Maxtor built by Maxtor" line - just as you can't point out that AMD deserves no credit for introducing the Athlon because engineers from DEC, which it acquired, had a hand designing AMD's Athlon system bus based on the EV6. The Atlas became a Maxtor brand and for all intents and purposes, they are Maxtor products, for better or for worse. It's a pity that they didn't capitalise on the expertise acquired and adapt more of their superb SCSI designs for IDE/SATA use, but that's another story. :)

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RE: Maxtor Sux

By dice1111 on 5/18/2006 10:04:20 AM , Rating: 2

Just bought a Barracuda 7200.9 300GB three days ago. Failed after I put my music and family pic's on it after about an hour of use. I've lost it all!!!

RMA'd and a new one's on the way...

Even Seagate has problem drives.

*Cries with much sad*

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RE: Maxtor Sux

By Madellga on 5/18/2006 12:46:54 PM , Rating: 2

I had a similar situation in January, but I tested the HD before using it and found the problem. I normally keep my data on the old hard drive for some days just to be sure.
Never think it is going to be OK to have your data in just one place, that's what Murphy wants...

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RE: Maxtor Sux

By AMDfreak on 5/18/2006 1:38:32 PM , Rating: 2

I'm sorry for your loss. This is exactly why I ponied up for a RAID 5 setup. You can usually do a basic RAID-5 array for about the same price as 1 huge drive, get about the same amount of storage and lots of data security. Depending on the setup you might even do better on speed than a single drive.

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Takeovers & the truth

By crystal clear on 5/18/2006 4:26:40 AM , Rating: 2

I am very suspicious of these mergers/takeovers,behind all those flashy statements hides the real intention of the takinover company.
Experience has shown they take upon themselves a huge debt to pay for the takeover,that eventually find very hard to pay back.To repay these debts they strip the company takenover of all its assets(cash & others sellable assets).
They fire all /or most of its staff-in short rip the takenover company into pieces.
Being BIG does not necessarily mean STRONG...
I do not say the above company will do the same ,but experience of other companies in takeovers have some sad stories in them.

RE: Takeovers & the truth

By Samus on 5/18/2006 5:28:47 AM , Rating: 2

Seagate spends hundreds of millions on advertising annually, a 1.7B buyout isn't going to hurt them whatsoever. Infact, the contracts (which they want above all) Maxtor has with OEM's is worth at least half that themselves.

Secondly, keep in mind Seagate kills their primary competitor in the high end hard disk (SCSI) and mainstream hard disk (SATA/PATA) sectors. They also eliminate their ONLY competition in the megnetic backup market, effectively putting an end (hopefully) to DLT technology. Maybe Seagate has some innovations for it...its not like Travan was any better.

DLT technology has proven unable to keep up with data storage requirements over the years. Most of my clients are still forced to backup to large hard disks because even autoloaders with 110GB DLT7 tapes can't hold a terabyte, and thats 7 tapes! Seagate has a hard disk that holds what 7 DLT tapes hold. DLT is also ludicrusly expensive.

DDS is almost dead as well, phew, more Sony crap bytes the dust.

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RE: Takeovers & the truth

By crystal clear on 5/18/2006 6:13:53 AM , Rating: 2

" I do not say the above company will do the same ,but experience of other companies in takeovers have some sad stories in them "

The above quote of mine is indeed very specific,I will not say its good or bad for either side.But you have take some external factors into consideration.
1) OEM sales are subject to many/various fluctuations, a drop in sales hurts also suppliers.Example-Dell CEO trip to TAIWAN to ask suppliers cut prices.

2) Technoligies are constantantly changing/progressing-whats good today is redundant tommorow.Technoligies are very sensitive to new developments in the hard disk sector.
You have to be future oriented & you never know what future holds for you.

3)In the hard disk sector -competition is hot & cut throat.
There is no shortage of competition,Hitachi & other big ones are there.

4) Today they Seagete are stong,but when the bad times hit you,They HIT YOU where it really HURTS.NO MERCY....
You got to service yours debts,you miss out a payment,you are in trouble.The Banks call in their LOANS,Your shares come crashing down,How do you prop up your share prices in the stock excahnge & so on.......

5) Your arguments are indeed convincing as a technocrat,but think like a CEO/CFO you will get the shivers.

I do not cast any doubts on SEAGATE in any way whatsover.

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RE: Takeovers & the truth

By theapparition on 5/18/2006 7:06:07 AM , Rating: 2

From what I understand from dealing with people in Colorado, and several who have relatives working for Maxtor, the entire organization.........everything, will be shut down. Seagate only wanted their larger overseas manufacturing capability.

I may be wrong, but I'm sure someone can verify.

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The only thing is...

By heffeque on 5/18/2006 9:23:25 AM , Rating: 2

The only thing is... how much market share does Seagate have now? 0_0 Too much IMHO. I own one and I'm extremely happy with it, but isn't it dangerous that it has so much power?

RE: The only thing is...

By Master Kenobi

(blog) on 5/18/2006 9:48:28 AM , Rating: 2

No. They have plenty of competitors. Western Digital, Hitachi, Toshiba, IBM, even Samsung. Now Toshiba and Hitachi typically stick to the Laptop sector, so that gives Seagate competition in that market. Western Digital is the only one that truly competes with Seagate now that Maxtor is gone, and Western Digital does make those nice raptors...... Seagate needs to make some like the Raptor. Overall Seagate is the best overall, their warranty and quality are second to none, but some of the other manufactureres offer considerable competition but only in specific areas.

Right now I have 2x 500GB Seagates and 1x 74GB Raptor Western Digital for my OS and Games :P

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RE: The only thing is...

By Madellga on 5/18/2006 3:29:15 PM , Rating: 3

Hey Padawan, IBM sold the HD business to Hitachi....

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Hmm...0.37 per share?

By Samus on 5/18/2006 1:48:12 AM , Rating: 3

Glad I sold my maxtor stock at 9.70, well more than it'd be worth once the merger finalizes.

Best investment I ever made... paid 3.90 a little over a year ago. I could have never predicted they'd be bought.

I love Seagate and their products, they're reliable, warrantied and priced well. Go Go Go!

By Xorp on 5/18/06, Rating: 0

RE: ha

By Samus on 5/18/2006 5:30:09 AM , Rating: 2

WD's the runner-up to Seagate ;)

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