After 85 days of review, the Australian Competition and Consumer Commission (ACCC) has announced it approves of moves by Seagate Technology to acquire Samsung’s hard disk drive division.
Seagate/Samsung deal gets ACCC thumbs up (Credit: Seagate)
The decision, part of an informal review by the ACCC, was handed down on December 13 with the group finding that the merger should not be opposed.
“The proposed acquisition will increase concentration in what are already highly concentrated markets,” the ACCC’s findings read.
“This is because post-mergers of both WD/HGST and Seagate/Samsung, the number of manufacturers in these HDD markets reduces from four global suppliers to only two global suppliers.”
Investigated was the impact that Seagate’s acquisition of Samsung’s division would have in the global markets for HDDs for computers, mobile devices, servers, storage systems and electronic devices in general.
The ACCC also found the acquisition would be “unlikely to result in a substantial lessening of competition” because Samsung “is not a leader of innovation or price discounting in the HDD industry”.
The deal between Seagate and Samsung was announced on April 19, and will see Samsung merge it’s flailing HDD division into Seagate’s as well as spurning a series of partnerships and an equity investment (equating to around 9.6% ownership) into Seagate by Samsung.
“We are pleased to strengthen our strategic relationship with Samsung in a way that better aligns both companies around technologies and products,” Steve Luczo, Seagate chairman, president and CEO said in a statement at the time.
“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.”
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