Fujitsu's 320-Gbyte 2.5-inch HDD announced in April 2008
Fujitsu's 320-Gbyte 2.5-inch HDD announced in April 2008
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Fujitsu Ltd and Toshiba Corp reached a basic agreement for Toshiba's acquisition of HDD business from Fujitsu Feb 17, 2009. They are planning to complete the business transfer in the April-June 2009 quarter.

Toshiba will take over Fujitsu's HDD business excluding the HDD head and media businesses. Toshiba will acquire the HDD design, development, manufacturing and marketing functions that Fujitsu owns inside and outside Japan.

Specifically, they are (1) Fujitsu's HDD development, manufacturing and sales divisions, (2) Fujitsu Laboratories Ltd's HDD technology development division, (3) Yamagata Fujitsu Ltd's divisions related to HDD design, development and quality assurance, (4) overseas manufacturing facilities of Fujitsu Computer Products Corp of the Philippines and Fujitsu (Thailand) Co Ltd and (5) overseas sales bases.

Yamagata Fujitsu's land and buildings will be handed over to Showa Denko KK.

The HDD business will be transferred to a new company in which Toshiba's and Fujitsu's capital ratios will be initially 80 and 20%, respectively. And Toshiba plans to make the company its wholly-owned subsidiary after a certain period of time.

Through this acquisition, Toshiba aims to solidify its position as the largest manufacturer in the market for 2.5-inch and smaller HDDs and to expand its share of the market for HDDs targeting enterprises, where Fujitsu has enjoyed a large share.

Toshiba set a goal to gain a global HDD market share of 20% in 2015. Also, the company will advance the development of SSDs for servers, fusing Toshiba's NAND flash memory technology and Fujitsu's technology for enterprise HDDs.

Showa Denko to gain share in HDD media market

Fujitsu will transfer its HDD media business, which was not included in its agreement with Toshiba, to Showa Denko. First, Fujitsu will establish a new company, which will take over the HDD media business run by Yamagata Fujitsu. Then Showa Denko will acquire all the shares of the new company from Fujitsu. The two companies plan to complete the transfer during the April-June 2009 quarter.

Yamagata Fujitsu has been engaged in developing and manufacturing aluminum media for server HDDs and glass media for HDDs used in notebook PCs and automotive devices, and it has been supplying all of them to Fujitsu. And Showa Denko's HDD media business holds a global market share of about 22%.

Considering that Showa Denko plans to launch a HDD joint venture with Hoya Corp, which has about 5% market share, and that Fujitsu's share is 4%, Showa Denko and HOYA will have a global market share of more than 30%.

Most of employees to be transferred to Toshiba

In January 2009, Fujitsu announced that it will terminate its HDD head business at the end of March 2009. Of the 9,000 employees engaged in Fujitsu's HDD business across the world, 360 involved in the media business will be employed by Showa Denko and 8,000 will be transferred to Toshiba. In addition, 400 who have been working for the HDD head business and the other 240 will be reallocated within the Fujitsu Group.