Corresponding Bloomberg Citing informed sources, Western Digital resumed merger talks with solid-state storage maker Kioxia late last year. Under the existing plan, the companies can merge and maintain their presence on the exchange in a new status. Both memory manufacturers have long been involved in the joint production of 3D NAND chips, and therefore from time to time consider a full pooling of assets.
Most recently, rumors attributed it to active negotiations in 2021, when the deal was valued at $20 billion, while Kioxia was also considering a public offering of shares, although the company’s management denied such rumors in October last year . Western Digital Corporation’s share price rose 5.2% following the news on Wednesday, taking the capitalization of the company’s business to $10.5 billion. After the close, listings rose another 8%.
The resumption of negotiations between the two companies could indicate the crisis in the industry, which has forced the partners to forget the previous contradictions that prevented the deal from being completed earlier. Since the beginning of last year, shares of Western Digital have fallen 51% due to the crisis in the storage market. After gaining relative independence from Toshiba in 2018, Kioxia remains the sole maker of advanced memory chips in Japan. One of the motives for the merger could be the desire to be able to more effectively counter the South Korean giant Samsung Electronics, which remains the market leader.