Seagate and Samsung have announced a 'broad strategic agreement' that will see the two work closely together on future projects, and hand the Korean giant a significant stake in its new American ally.
Seagate is among the world leaders in storage and hard drives, so an alliance with Samsung – one of the giants of consumer electronics on a global scale seems sensible.
The partnership will bring interesting changes to both companies, with Samsung combining its HDD business into Seagate, providing semiconductors for use in Seagate's business focused solid state drives and – most obviously – providing the hard drives for Samsung products.
Definitive
"[The companies] have entered into a definitive agreement under which Seagate and Samsung will significantly expand and strengthen their strategic relationship by further aligning their respective ownership, investments and key technologies."
Samsung will receive "significant equity ownership" in Seagate and will provide a board member for the Californian company as well as a pot of money and ordinary shares.
"The combined value of these transactions and agreements is approximately $1.375 billion, which will be paid by Seagate to Samsung in the form of 50% stock and 50% cash."
Strategic
"We are pleased to strengthen our strategic relationship with Samsung in a way that better aligns both companies around technologies and products," said Steve Luczo, Seagate chairman, president and CEO.
"With these agreements, we expect to achieve greater scale and deliver a broader range of innovative storage products and solutions to our customers, while facilitating our long-term relationship with Samsung."
"Delivering value to the market and consumers is the primary goal of the extensive agreement announced today addedsaid Oh-hyun, Kwon, president of the semiconductor business of Samsung Electronics.
"Samsung looks forward to extending our existing strategic ties with Seagate, to deliver creative technology solutions for a broad diversity of consumer, business and industrial applications."
