When IBM sold its computer lineup to Chinese company Lenovo there was a huge political debate. Would selling high technology to China be a risk factor? Apparently not as Lenovo nowadays sells the old IBM PCs and is dong a fine job too. The next political venture to cause such an alarm is the story spilled by William Watkins of Seagate Technology. He said that a large Chinese technology corporation is in the venture of acquiring an American disk maker. Currently there are only two disk makers left after IBM chose to sell its harddrive division to Hitachi, which leaves us with Western Digital and Seagate.
Seagate is the biggest disk manufacturer on the market, with WD as second, closely followed by Hitachi. In May of last year, Seagate acquired Maxtor, which was the fourth largest harddrive maker at the time. The remaining three occupy more than two thirds of the market today and acquisition of any of them would result in a substantial shift.
According to the news story by New York Times, there are many obstacles before an acquisition, not only American but also Chinese. The Chinese government is namely very careful about what kind of investments it allows. The American counterpart isn’t exactly thrilled either, “I do not think anyone in the U.S. wants the Chinese to have access to the controller chips for a disk drive. One never knows what the Chinese could do to instrument the drive.”
According to the article Seagate isn’t for sale, but says it’s hard to stop a high enough premium offered to shareholders. Western Digital on the other hand, declined to comment. Which of the two that is the actual target remains untold, but Seagate is the most prominent developer of new harddrives technology, but WD would probably be a lot cheaper to acquire.
