Western Digital has now officially announced its entrance to the Solid State Market. By acquiring SiliconSystems, Inc. for $65 million in cash, Western Digital has gotten an instant shoe-in on the fast emerging SSD market. SiliconSystems have been supplying embedded systems with fast and reliable SSD storage since the interception in 2002, and in 2008 this segment of the market made up one third of the market. Together the two could really become a serious threat to the other companies desperately trying get a piece of the SSD cake.
Press release after the break;
WD Enters Solid-State Drive Market With Acquisition of SiliconSystems, Inc.
LAKE FOREST, Calif., March 30 /PRNewswire-FirstCall/ — Western Digital Corp. (NYSE: WDC), a world leader in hard drive storage for computing and consumer electronics applications, today announced that it has completed a $65 million cash acquisition of SiliconSystems, Inc., Aliso Viejo, Calif., a leading supplier of solid-state drives for the embedded systems market.
Since its inception in 2002, SiliconSystems has sold millions of SiliconDrive® products to meet the high performance, high reliability and multi-year product lifecycle demands of the network-communications, industrial, embedded-computing, medical, military and aerospace markets. These markets accounted for approximately one third of worldwide solid-state drive revenues in 2008. SiliconSystems’ product portfolio includes solid-state drives with SATA, EIDE, PC Card, USB and CF interfaces in 2.5-inch, 1.8-inch, CF and other form factors. SiliconSystems has developed extensive intellectual property to address the stringent embedded systems market requirements to ensure data integrity, eliminate unscheduled downtime, protect application data and software and provide for data security and protection through its patented and patent-pending PowerArmor®, SiSMART®, SolidStor® and SiSecure™ technologies.
WD’s storage industry leadership, worldwide infrastructure, and technical and financial resources will enable further growth in SiliconSystems’ existing markets and customer relationships. SiliconSystems’ intellectual property and technical expertise will provide additional building blocks for future products to address emerging opportunities in WD’s existing markets.
“We are delighted to have the SiliconSystems team join WD,” said John Coyne, president and CEO of WD. “The combination will be modestly accretive to revenue and margins as a result of SiliconSystems’ existing position as a trusted supplier to the well-established $400 million market for embedded solid-state drives. SiliconSystems’ intellectual property and technical expertise will significantly accelerate WD’s solid-state drive development programs for the netbook, client and enterprise markets, providing greater choice for our customers to satisfy all their storage requirements.”
Integration into WD begins immediately, with SiliconSystems now becoming known as the WD Solid-State Storage business unit, complementing WD’s existing Branded Products, Client Storage, Consumer Storage and Enterprise Storage business units.
“WD’s strong balance sheet, sales reach, and operations and logistics capabilities will allow us to greatly accelerate our penetration of our existing markets, while combining our engineering expertise with WD will enable us to develop new solid-state drives to broaden our overall product portfolio and address the emerging applications for solid-state storage in WD’s existing customer base,” said Michael Hajeck, a founder and CEO of SiliconSystems, now senior vice president and general manager of WD’s Solid-State Storage business unit. “We are extremely excited to be joining WD and enabling an even stronger future for our talented team.”
A set of questions and answers related to today’s announcement can be found on WD’s website at http://www.wdc.com/en/company/investor/QandA.asp.
About WD
WD, one of the storage industry’s pioneers and long-time leaders, provides products and services for people and organizations that collect, manage and use digital information. The company produces reliable, high-performance drives that keep users’ data accessible and secure from loss. WD applies its storage expertise to consumer products for external, portable and shared storage applications.
WD was founded in 1970. The company’s storage products are marketed to leading systems manufacturers, selected resellers and retailers under the Western Digital and WD brand names. Visit the Investor section of the company’s Web site (www.westerndigital.com) to access a variety of financial and investor information.
This press release contains forward-looking statements concerning: further growth in SiliconSystems’ existing markets and customer relationships; the ability of SiliconSystems’ intellectual property and technical expertise to address emerging opportunities in WD’s existing markets; the accretive impact of the acquisition of SiliconSystems by WD; acceleration of WD’s solid-state drive programs by SiliconSystems’ intellectual property and technical expertise; acceleration of SiliconSystems’ penetration into existing markets; and development of new solid-state drives to broaden SiliconSystems’ overall product portfolio and to address emerging applications for solid-state storage in WD’s existing customer base. The foregoing forward-looking statements are based on WD’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including: the impact of current negative global economic conditions; supply and demand conditions in the data storage industry; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products based on new technologies and expansion into new data storage markets; business conditions and growth in the various data storage markets; pricing trends and fluctuations in average selling prices; and other risks and uncertainties listed in WD’s recent Form 10-Q filed with the SEC on January 29, 2009, to which your attention is directed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and WD undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances.
Western Digital, WD, the WD logo, SiliconSystems, SiliconDrive, PowerArmor, SiSMART, SolidStor and SiSecure are trademarks of Western Digital Technologies, Inc. or its subsidiaries in the U.S. and other countries.
