Components & Peripherals News
Western Digital, Kioxia Merger Talks On Again: Report
Joseph F. Kovar
The revived merger talks, should they lead to an actual deal, could strengthen the two in their battle for flash storage leadership at a time when larger competitors like Intel are investing heavily to move the production of flash and other memory technology away from China.
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Merger talks between Western Digital and Kioxia appear to have begun again, a move that would if successful would consolidate the storage drive industry down to a tiny handful of vendors.
Western Digital, the San Jose, Calif.-based developer of hard and flash storage drives and storage systems, and Kioxia, the Japan-based developer of flash memory and flash storage drives, are considering merging into a single publicly-traded company, Bloomberg reported Wednesday.
Both Western Digital and Kioxia responded to a CRN request for further information by saying the companies do not comment on speculation about rumors or M&A activity.
[Related: The 10 Coolest Storage Component Vendors: The 2022 Storage 100]
This is not the first time the two companies have considered a merger. Western Digital and Kioxia were discussing a merger in August, 2021, although those talks went nowhere.
Prior to that, Western Digital and Boise, Idaho-based DRAM and flash memory manufacturer Micron were looking at a possible acquisition of Kioxia in a deal that might value Kioxia at about $30 billion.
Western Digital and Kioxia have a 20-year joint venture for developing flash memory at the Yokkaichi Plant, the largest semiconductor plant in Japan.
Western Digital in June said it was evaluating strategic and financial alternatives, including a full separation of its flash business. Such a separation, should it come to pass, would follow a similar move by Intel late 2021 to sell its flash technology business to South Korea-based SK Hynix, which became a new flash storage company named Solidigm.
Kioxia, which until October of 2019 was known as Toshiba Memory, continues to be a world leader in memory and SSD technologies, including SLC NAND flash memory, NAND with integrated controllers, and 3D BiCS FLASH technology, along with enterprise, data center, and client SSDs.
A merger with Kioxia would give Western Digital access to top-notch flash memory and SSD technology during a time when the U.S. government and IT industry are both continuing to look for ways to reduce reliance on overseas suppliers of high-value technologies in the face of competitive threats from China where much of the storage industry’s production is centered.
This comes at a time when Intel is planning to invest over $20 billion to construct two new leading-edge chip factories in Ohio, in addition to $20 billion it plans to invest in two new fabs in Arizona and $3.5 billion it plans to invest in semiconductor packaging facilities in New Mexico.
