HARD DRIVE MAKER Western Digital will have to sell part of its business to Toshiba in order to buy Hitachi Global Storage Technologies, the US Federal Trade Commission (FTC) has announced.
The FTC has ordered Western Digital to sell some desktop hard disk drive (HDD) assets to Toshiba in order to maintain competition in the global HDD market. Western Digital and Toshiba signed a tentative deal, we reported last week, and the FTC is ready to approve it.
Under the proposed FTC order, Toshiba will receive all of the productive assets needed to replicate Hitachi Global Storage Technologies' position in the desktop hard disk drive market. The order also requires Western Digital to provide Toshiba with access to its employees involved in research and development and the production of desktop hard disk drives, and requires Western Digital to license all intellectual property needed to make and supply desktop hard disk drives to Toshiba.
"The proposed transaction was reviewed by antitrust enforcement agencies around the world, as well as by the Commission. Commission staff cooperated with antitrust agencies in Australia, Canada, China, the European Union, Japan, Korea, Mexico, New Zealand, Singapore, and Turkey, often working closely with the staff of these agencies on the analysis of the proposed transaction and potential remedies to reach outcomes that benefit consumers in the United States," the FTC said.
The commission vote approving the proposed consent order was 4-0. The FTC added that it will publish the proposed order in the Federal Register "shortly", and said that it will be subject to public comment for 30 days until 4 April, 2012, after which the commission will decide whether to make it final.
The FTC has addressed concerns that the deal as originally proposed would have left only two companies, Western Digital and Seagate Technology, in control of the entire worldwide market for desktop hard disk drives.
FTC Bureau of Competition director Richard Feinstein noted that the move is intended to ensure that "vigorous competition continues" in the global HDD market.
The FTC had complained that Western Digital's proposed acquisition of Hitachi Global Storage Technologies would "likely be anticompetitive" and would violate Section 5 of the FTC Act and Section 7 of the Clayton Act by reducing competition globally. The FTC reckoned that the deal would reduce the number of competitors in that market from three to two and would likely allow Western Digital to "exercise market power, resulting in higher prices for consumers".
The FTC intervention comes almost a year after the announcement on 7 March, 2011 that Western Digital intended to acquire Hitachi Global Storage Technologies - which now has the snappy new name of Viviti Technologies - from Hitachi for approximately $4.5bn. µ
Should save some security blushes
Was in and out of there like the hokey cokey; pre chokey
But 1Gbps speeds will only hit two million homes and businesses
He tried to undo her bra clasp. 'Error. Error. Error. Cannot Compute,' he cried