May 22, 2006
Seagate Technology (NYSE: STX) today announced that it has completed its acquisition of Maxtor Corporation. The combined Company retains the Seagate name and continues to be listed on the New York Stock Exchange as "STX". Maxtor common stock has ceased to trade on the New York Stock Exchange.
The integration of former Maxtor operations into Seagate is expected to be completed substantially by early calendar year 2007, with an earnings per share accretion target of 10-20% after the first year of combined operations.
"This is an exciting time for Seagate and for our industry," said Bill Watkins, Seagate President and CEO. "The demand for storage is at record levels globally and is continuing to grow. The past twenty years was about digitising the workplace; the next decade will be focused on digitising your lifestyle. As a result of this acquisition, we believe that Seagate has the enhanced scale and capacity to better drive technology advances and accelerate delivery of a wide range of differentiated products and cost-effective solutions to a growing customer base."
"Our integration teams have made excellent progress on addressing customer requirements, continuity of supply, the optimisation of manufacturing and production capacity and workforce planning," said Dave Wickersham, Executive Vice President and COO. "As a result, we have an opportunity to complete our integration plan substantially in six to nine months."
"We are encouraged by the dialogue we have had with customers and are confident that the combined Company will deliver more compelling products and services more efficiently to customers," said Brian Dexheimer, Executive Vice President, Global Sales and Marketing. "Our integration plan is designed to ensure revenue retention by executing a seamless transition to Seagate products for Maxtor customers and by continuing to meet the product, supply, quality and cost demands of our total combined customer base."
Seagate estimates that approximately 50% of Maxtor's worldwide employees will be offered positions in the combined Company moving forward, with the vast majority of those located in Asia Pacific manufacturing operations.
Adding to Seagate's own line of branded products, Seagate will retain a full range of Maxtor branded retail solutions. Maxtor is the leading brand name in the retail space and it will strengthen Seagate's overall position significantly in this burgeoning market. The combination of the two brands and the associated product lines represents the widest, most differentiated storage offering available to consumers today.
Company management will hold a conference call to discuss completion of the acquisition today at 8:00 a.m. US Eastern Time. The conference call can be accessed live via telephone as follows:
USA: (877) 223 6202
International: +1 (706) 679 3742
A replay of the call will be available beginning at 11:00 a.m. Eastern Time today until 29 May 2006 at 11:59 p.m. US Eastern Time, and can be accessed online at www.seagate.com/newsinfo/invest or by telephone as follows:
USA: (800) 642 1687
International: +1 (706) 645 9291
Access Code: 9162676
Seagate is the worldwide leader in the design, manufacturing and marketing of hard disc drives, providing products for a wide range of Enterprise, Desktop, Mobile Computing and Consumer Electronics applications. Seagate's business model leverages technology leadership and world-class manufacturing to deliver industry-leading innovation and quality to its global customers, and to be the low cost producer in all markets in which it participates. The Company is committed to delivering award-winning products, customer support and reliability to meet the world's growing demand for information storage. Seagate can be found around the globe and at www.seagate.com.
Seagate, Seagate Technology and the Wave logo are registered trademarks of Seagate Technology LLC.
This press release contains forward-looking statements within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as amended. These forward-looking statements include, but are not limited to, statements relating to future financial performance and expected earnings accretion from the Maxtor acquisition, the timeline for the integration of the former Maxtor operations into Seagate, price and product competition, customer demand for our products and general market conditions. These forward-looking statements are based on information available to Seagate as of the date of this press release. Current expectations, forecasts and assumptions involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by these forward-looking statements. Such risks and uncertainties include a variety of factors, some of which are beyond the Company's control. In particular, such risks and uncertainties include Seagate's ability to integrate the Maxtor acquisition into its operations; the impact of the variable demand and the aggressive pricing environment for disc drives; dependence on the Company's ability to successfully manufacture its current and new disc drive products in increasing volumes on a cost-effective basis and with acceptable quality; the adverse impact of competitive product announcements and possible excess industry supply with respect to particular disc drive products; the impact of the actual closing of the acquisition of Maxtor on the Company's financial results, including, but not limited to, charges associated with restructuring, purchase accounting and other related transaction costs, and due to shifting of customer demand to the Company's competitors or aggressive pricing specially targeted to encourage such shifting; and the possibility that the combination of Seagate and Maxtor will not provide the anticipated benefits to the combined Company on the projected timeline, if at all. Information concerning additional factors that could cause results to differ materially from those projected in the forward-looking statements is contained in the Company's Annual Report on Form 10-K as filed with the US Securities and Exchange Commission on 1 August 2005; in the Company's Quarterly Report on Form 10-Q as filed with the US Securities and Exchange Commission on 28 April 2006; and in the Company's Registration Statement on Form S-4, as originally filed with the US Securities and Exchange Commission on 14 March 2006 and as amended on 13 April 2006. These forward-looking statements should not be relied upon as representing the Company's views as of any subsequent date and Seagate undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date on which they were made.