SAN JOSE and SANTA ANA, Calif., June
24, 2013 /PRNewswire/ -- Western Digital®
Corporation (NASDAQ: WDC) and sTec, Inc. (NASDAQ: STEC) announced
today that they have entered into a definitive merger agreement
under which sTec, Inc., an early innovator in enterprise
solid-state drives (SSDs), will be acquired by HGST, a wholly-owned
subsidiary of Western Digital. sTec will be acquired for
approximately $340 million in cash,
which equates to $6.85 per share.
This represents approximately $207
million in enterprise value, net of sTec's cash as of
March 31, 2013.
The pending acquisition augments HGST's existing solid-state
storage capabilities, accelerating its ability to expand its
participation in the rapidly growing area of enterprise SSDs. HGST
remains committed to its highly successful joint development
program with Intel® Corp. and will continue to deliver
current and future SAS-based SSD products with Intel.
sTec has strong engineering talent and intellectual property
that will complement HGST technical expertise and capabilities.
HGST will continue to support existing sTec® products
and collaborate with its customers to understand their future
requirements.
"Solid state storage in the enterprise will play an increasingly
strategic role in the future of Western Digital," said Steve Milligan, president and chief executive
officer, Western Digital Corporation. "This acquisition is one more
building block in our strategy to capitalize on the dramatic
changes within the storage industry by investing in SSDs and other
high-growth storage products."
"This acquisition demonstrates HGST's ongoing commitment to the
rapidly growing enterprise SSD segment, where we already have a
successful product line," said Mike
Cordano, president, HGST. "We are excited to welcome such a
talented team of professionals to HGST, where their inventive
spirit will be embraced and encouraged."
"At this key point in the evolution of the storage industry,
sTec is excited to consummate this transaction. It will be an
important next step in proliferating many of the innovative
products and technologies that sTec has been known for throughout
its 23-year history and provides immediate value for our
shareholders and a strong future for our employees and customers,"
said Mark Moshayedi, president and
chief executive officer, sTec. "This merger will enable our
world-class engineering team and IP to continue to make a
significant contribution to the high-performance enterprise SSD
space that has long been sTec's focus."
The board of directors of sTec, on the unanimous recommendation
of a special committee of independent directors of the board, has
unanimously approved the merger agreement and has resolved to
recommend that sTec shareholders approve the transaction at a sTec
shareholders meeting to be held to approve the merger agreement and
the merger. The directors and executive officers of sTec have
entered into separate voting agreements under which they have
agreed, subject to certain exceptions, to vote their respective
shares in favor of the proposed transaction.
Wells Fargo Securities, LLC has acted as the financial advisor
to Western Digital and BofA Merrill Lynch has acted as the
financial advisor to sTec in connection with this transaction.
Closing of the acquisition, which is subject to customary
conditions, is expected to occur in the third or fourth calendar
quarter of 2013.
Supplemental Information
A question and answer
document related to the sTec acquisition is available on the
Western Digital website at www.wdc.com or click here. The companies
are not holding a conference call related to the acquisition;
Western Digital will provide additional commentary on its next
quarterly results conference call scheduled for Wednesday, July 24, after the close of the NASDAQ
market.
About Western Digital Corporation
Western Digital
Corporation (NASDAQ: WDC), Irvine,
Calif., is a global provider of products and services that
empower people to create, manage, experience and preserve digital
content. Its subsidiaries design and manufacture storage devices,
networking equipment and home entertainment products under the
WD®, HGST and G-Technology brands. Visit the Investor
section of the company's website (www.westerndigital.com) to access
a variety of financial and investor information.
About HGST
HGST (formerly known as Hitachi Global
Storage Technologies or Hitachi GST), a Western Digital company
(NASDAQ: WDC), develops advanced hard disk drives, enterprise-class
solid state drives, innovative external storage solutions and
services used to store, preserve and manage the world's most valued
data. Founded by the pioneers of hard drives, HGST provides
high-value storage for a broad range of market segments, including
Enterprise, Desktop, Mobile Computing, Consumer Electronics and
Personal Storage. HGST was established in 2003 and maintains its
U.S. headquarters in San Jose,
California. For more information, please visit the company's
website at http://www.hgst.com.
About sTec, Inc.
sTec, Inc. is a leading global
provider of enterprise-class, solid-state storage solutions
designed for the ever-growing performance, reliability and
endurance requirements of today's advanced data centers. The
industry's first company to deploy solid-state drives (SSDs) into
large-scale enterprise environments, sTec offers the industry's
widest range of solid-state storage solutions, which protect
critical information for major business and government
organizations worldwide. Headquartered in Santa Ana, California, sTec also serves the
embedded and military/aerospace segments with SSDs for industrial
and rugged environments. For more information, visit
www.stec-inc.com.
Forward Looking Statements
This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include statements concerning benefits expected from the
sTec acquisition, the expected timing of the completion of the
transaction and management's anticipated plans and strategies for
the sTec business. These forward-looking statements are based on
management's current expectations and are subject to risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements,
including failure to consummate or delay in consummating the
transaction; the possibility that the expected benefits of the
transaction may not materialize as expected; failure to
successfully integrate the products, technology, research and
development capabilities, infrastructure and employees of HGST and
sTec; the impact of continued uncertainty and volatility in global
economic conditions; actions by competitors; business conditions
and growth in the various hard drive markets; and other risks and
uncertainties listed in Western Digital's and sTec's filings with
the Securities and Exchange Commission (the "SEC"), including
Western Digital's recent Form 10-Q filed with the SEC on
May 3, 2013 and sTec's recent Form
10-Q filed with the SEC on May 8,
2013, to which your attention is directed. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof, and neither
Western Digital nor sTec undertakes any obligation to update these
forward-looking statements to reflect subsequent events or
circumstances.
Additional Information about the Merger and Where to Find
It
In connection with the proposed merger, sTec, Inc. will
file a proxy statement with the SEC. Additionally, sTec and Western
Digital Corporation will file other relevant materials in
connection with the proposed acquisition of sTec. The materials to
be filed by sTec with the SEC may be obtained free of charge at the
SEC's website at www.sec.gov. Investors and security holders of
sTec are urged to read the proxy statement and the other relevant
materials when they become available before making any voting or
investment decision with respect to the proposed merger because
they will contain important information about the merger and the
parties to the merger. sTec and its directors and executive
officers may be deemed to be participants in the solicitation of
proxies of sTec shareholders in connection with the proposed
merger. Investors and security holders may obtain more detailed
information regarding the names, affiliations and interests of
certain of sTec's executive officers and directors in the
solicitation by reading the proxy statement relating to the merger
and other relevant materials filed with the SEC when they become
available. Additional information concerning sTec's directors and
executive officers, including their ownership of sTec's common
stock, is set forth in sTec's 2013 annual meeting proxy statement
filed with the SEC on June 7, 2013
and will also be set forth in the proxy statement relating to the
merger when it becomes available.
Western Digital, WD, HGST and the WD and HGST logos are
registered trademarks in the U.S. and other countries. sTec and the
sTec logo are either registered trademarks or trademarks of sTec,
Inc. in the U.S. and certain other countries. Other
marks may be mentioned herein that belong to other companies.
(Logo: http://photos.prnewswire.com/prnh/20000711/WDCLOGO)
SOURCE Western Digital Corp.