Disk-drive manufacturer Seagate Technology has completed its acquisition of Maxtor by saying it will fire about half of Maxtor’s 12,000-person workforce.
Disk-drive manufacturer Seagate Technology has completed its acquisition of Maxtor by saying it will fire about half of Maxtor’s 12,000-person workforce. <\/P>
Most of those cuts will occur in the United States not Australia or Asia Pacific. Seagate will keep Maxtor’s new disk-drive factory in China, along with roughly 6,000 people who work for Maxtor in Asia. No Seagate employees will be eliminated. The deal leaves Seagate with a worldwide workforce of 55,000.<\/P>
Seagate, is officially based in the Cayman Islands, is the world’s largest maker of disk drives for personal computers. It announced in December that it would acquire Maxtor, a rival disk-drive company, in a stock swap valued at roughly $1.9 billion. Shareholders of both firms approved the deal last week. <\/P>
Mark Geenen, president of TrendFocus, a market research firm called the deal a surgical operation that cut out the expensive parts of Maxtor, while allowing Seagate to boost its manufacturing capacity. “This is a very clear-headed move,” said Geenen, describing disk drives as a commodity market that’s been great for consumers but tough on manufacturers. <\/P>
In 1997, for instance, a 10-gigabyte hard-disk drive was rare and cost $650, Geenen said. Today, an 80-gig drive runs less than $50, he said. To profit amidst plunging prices, disk-drive manufacturers have been consolidating and the number of brands has been shrinking. But Seagate Chief Executive Officer William Watkins made clear Monday that this deal would not be a merger so much as a meal in which Seagate swallowed only those parts of Maxtor that made sense. <\/P>
“When you announce a merger or acquisition, and intend to blend roadmaps, processes, etc. . . . you end up with two companies in turmoil,” he said Monday. <\/P>
Other than the factory in China and some facilities in Singapore, what Seagate found most appetizing was Maxtor’s popular line of backup-storage products and some high-end disk-drive development being done in Colorado and Massachusetts. Fewer than 100 people in Milpitas will be retained to continue the backup-storage line, said Seagate spokesman Brian Ziel . <\/P>
John Rydning, an analyst with IDC market research in Massachusetts, said even before acquiring Maxtor, Seagate had a 29 percent market share, ahead of second-place Western Digital (18 percent) and third-place Hitachi (14 percent). Maxtor had been fourth with a 12 percent share. <\/P>
“While it’s painful for the people involved, it’s healthy for the industry and for Seagate and its shareholders,” Rydning said<\/P><\/p>\n","protected":false},"excerpt":{"rendered":"
Disk-drive manufacturer Seagate Technology has completed its acquisition of Maxtor by saying it will fire about half of Maxtor’s 12,000-person workforce.<\/p>\n","protected":false},"author":42,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[28,8],"tags":[],"class_list":["post-83717","post","type-post","status-publish","format-gallery","hentry","category-archive","category-hardware","post_format-post-format-gallery"],"yoast_head":"\n