Hard disk vendors Quantum and Maxtor announced the details of their merger to media representatives from throughout the Asia-Pacific region at a press symposium in Singapore last week.
Although the two companies are still in the throws of making the merger comply with legal guidelines, Quantum CEO Michael Brown explained the details of the agreement.
In a deal valued at about $US 2.3 billion, Quantum's HDD stockholders will receive 1.52 shares of Maxtor common stock for every share of HDD common stock they own.
The merger will see Quantum's hard disk manufacturing arm merge with Maxtor's current operations. Despite differing approaches to production, both companies will continue to supply current lines of stock. In the long term, the merger plan will see Maxtor operations gradually adopt the highly robotised Quantum production processors.
While Quantum's hard disk arm will adopt the Maxtor name through the merger deal, its storage operations will continue to trade under the Quantum name.
Industry pundits are describing the move as an attempt to remain competitive in the cut throat hard disk market. This latest consolidation has reduced to line-up to two major players, Maxtor and Seagate.