After months of negotiations, Western Digital and Kioxia are reportedly close to finalizing a merger agreement. bloombergciting a source familiar with the matter. The deal includes the separation of Western Digital’s NAND flash business and its integration with Kioxia.
The details of the merger remain confidential, but the report claims Western Digital shareholders will gain control of just over half of the combined company. The day-to-day management of the combined company is implied to be primarily led by Kioxia management. However, Western Digital executives will also play an important role.
Negotiations are progressing, but no final agreement has yet been reached, so the schedule is subject to change. In fact, the discussion may end without any agreement at all.
The combined company will adopt a dual board representation system with both chip makers as members. Based in Japan, the company will initially list on the Nasdaq and eventually Tokyo. Meanwhile, Bain Capital, a major investor in Kioxia, will receive a special dividend.
Despite Kioxia and Western Digital producing 3D NAND in the same factory, Kioxia is primarily focused on selling memory chips and maintains different business strategies. Western Digital’s approach, by contrast, leans toward supplying his complete NAND-based products, including some of the best of his SSDs available.
As of the first quarter of 2023, Kioxia held a 21.5% stake in NAND Memory, while Western Digital secured a 15.2% share, according to the company. trend force. Samsung, on the other hand, distributed his 34% of his NAND memory around the same time. With this in mind, the combined entity of Kioxia and Western Digital’s flash businesses is expected to capture more than 36.7% of the market share and become the leading supplier of NAND memory worldwide.