Seagate, the renowned data storage firm, has revealed its plan to acquire Intevac, a manufacturer of hard drive equipment, in an all-cash transaction valued at $119 million.
On Thursday, Seagate announced it will offer $4 per share for Intevac, a company listed on the stock exchange. Initially, Seagate intends to buy a minimum of “at least one share more than 50%” of Intevac’s outstanding shares and will subsequently conduct a “second step” merger to acquire the remaining shares of the company.
The board of directors and major shareholders of Intevac have given their unanimous approval for the deal. Seagate anticipates that the acquisition will finalize in late March or early April, pending standard closing conditions.
Intevac, based in Santa Clara and founded in 1991 as a spin-off from Varian Associates, specializes in manufacturing thin film deposition systems. The company went public in 1995 and has expanded its operations to various locations, including China, Malaysia, and Singapore.
According to its website, Intevac’s products facilitate the production of hard drive disk media and enhance existing hard drive systems. One of the key technologies it advocates is heat-assisted magnetic recording (HAMR), which boosts the “writeability” and storage density of hard drives through the application of heat energy.
This acquisition aligns seamlessly with Seagate’s hard drive disk operations. Just last December, Seagate announced the launch of its first HAMR-based hard drive after a twenty-year gap, with plans to deliver these drives to several clients, including a prominent cloud provider, this year.
Competitors such as Western Digital and Toshiba are also working on HAMR-based technology, driven by the surging global demand for data storage. HAMR technology tends to offer cost benefits compared to traditional solid-state solutions, making it particularly appealing for public cloud service providers.
As of Thursday, Intevac’s market capitalization stood at roughly $91.17 million. In the most recent fiscal quarter (Q3 2024), the company recorded a revenue of $28.5 million, a 59% increase compared to the previous year, although it faced a net loss of $2.17 million.
Last year, Intevac announced that it was assessing “strategic options” and undergoing a restructuring it believed would significantly enhance profitability. One of these strategic moves appeared to be considering leaving the public market.
This acquisition marks Seagate’s first major purchase since acquiring Kioxia, a supplier of flash memory and SSDs, in 2017. Throughout its 46-year history, Seagate has made 11 acquisitions, totaling approximately $18 billion, according to financial database Tracxn.
Compiled by Techarena.au.
Fanpage: TechArena.au
Watch more about AI – Artificial Intelligence
