Seagate Acquires Intevac for $119M: Boosting Hard Disk Drive Technology
Seagate Technology, a leading name in the data storage industry, is set to acquire Intevac, a prominent producer of hard drive equipment, in a strategic all-cash deal valued at $119 million. This acquisition is anticipated to enhance Seagate’s product offerings in the hard drive sector.
Details of the Acquisition
On Thursday, Seagate announced that it plans to pay $4 per share in a tender offer for Intevac, which is publicly traded. The acquisition process will begin with Seagate purchasing a minimum of “at least one share more than 50%” of Intevac’s outstanding shares. This will be followed by a “second step” merger to acquire the remaining shares.
Approval from Intevac’s Board
The transaction has received unanimous approval from Intevac’s board of directors and its largest shareholders. Seagate expects the deal to finalize in late March or early April, pending customary closing conditions.
About Intevac
Founded in 1991 as a spin-off from Varian Associates, Intevac is based in Santa Clara and specializes in manufacturing thin film deposition systems. The company went public in 1995 and has since expanded into markets including China, Malaysia, and Singapore.
Innovative Technologies
- Intevac’s products support hard drive disk media production.
- The company is known for its heat-assisted magnetic recording (HAMR) technology.
- HAMR significantly boosts the writeability and storage density of hard drives by applying heat energy.
This innovative approach aligns well with Seagate’s business model. In December, Seagate introduced its first HAMR-based hard drive after a two-decade gap, planning to deliver these drives to several customers, including a leading cloud provider, this year.
Market Context
Seagate faces competition from other major players like Western Digital and Toshiba, who are also developing HAMR-based drives. The growing global demand for storage solutions has made HAMR technology increasingly attractive, particularly for public cloud vendors due to its cost advantages over traditional solid-state technologies.
Intevac’s Financial Outlook
As of Thursday, Intevac’s market capitalization stood at approximately $91.17 million. In its latest fiscal quarter (Q3 2024), the company reported revenues of $28.5 million, a notable increase of 59% year-over-year, although it also experienced a net loss of $2.17 million.
Intevac announced plans late last year to explore “strategic options” while undergoing a restructuring aimed at enhancing profitability, which included the potential exit from public markets.
Seagate’s Acquisition History
This acquisition marks Seagate’s first significant move since purchasing Kioxia, a supplier of flash memory and solid-state drives, back in 2017. According to financial database Tracxn, Seagate has completed 11 acquisitions throughout its 46-year history, amounting to approximately $18 billion.
For more updates on technology and business acquisitions, stay tuned!
