back to article Western Digital open to spinning out flash, hard disk businesses

Western Digital has confirmed the board is considering "strategic alternatives" for the storage supplier, including spinning out its flash and hard disk businesses. This follows calls last month by activist investor Elliott Management, which has amassed a $1 billion investment in WD equating to a six percent share stake, for a …

  1. Doctor Syntax Silver badge

    So let's see. Leveraged buy-out of one or both businesses. Elliott* and other shareholders get a big payout, the businesses get loaded with debt, struggle to make a profit because of the interest, maybe get subject to another** leveraged buy-out and eventually fold leaving the creditors, largely those who lent for the ultimate buy-out, in the lurch. Bye bye WD. Have I missed anything out?

    * Who always know better than current management of such a range of companies and must, therefore, be brilliant managers, so much so you wonder why they don't just start a few companies and run them so well they take over the world.

    ** How many did Maplin go through?

    1. Platinum blond(e)

      Think you nailed it. Then after the scraps of this deal are rooted through, repeat with Seagate. The end of hard disk drives quickly follows. * **

      *: except for cold (storage) niches I guess.

      **: I know many fine engineers who have spent most/all their careers at one or another of these firms.

  2. Claverhouse Silver badge
    Meh

    Genuine Question

    ...spinning out its flash and hard disk businesses.

    .

    Exactly what else does WD do ?

    1. NeilPost Silver badge

      Re: Genuine Question

      I guess it would leave SSD’s but the commonality of product set and procurement/economies of scale in memory for the non-spinning discs makes no sense by breaking this up.

      A grubby private equity/debt money-scraping exercise only.

    2. EricB123 Bronze badge

      Re: Genuine Question

      Maybe there is money to be made in selling WD branded raincoats?

      The rainy season in Asia is just getting started, you know.

  3. Timbo Bronze badge

    mmmm...I wonder what their plans are?.

    So, Elliott Management own Sandisk?

    And EM, also have shares in WD and want them to spin out/separate the HDD/Flash memory business...

    Anyone see a ploy here by which EM then takeover the WD HDD/Flash business, then discontinue making HDDs and then they can name their own prices for Sandisk and WD SSDs....

    1. NeilPost Silver badge

      Re: mmmm...I wonder what their plans are?.

      WD Own Sandisk.

  4. Anonymous Coward
    Anonymous Coward

    As someone who worked for a company that Elliott Management took a large stake in and pushed around, fcuk Elliott Management. Bunch of scumlord no-morals sleazebags.

  5. EricB123 Bronze badge

    I hope this equity investment firm doesn't try something exotic like CRT memory. Never had much use for equity investment firms. They gut the place, plunder what they can and move on to the next victim, I mean company.

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