Seagate Buys Maxtor for $1.9 Billion
By Nate Mook | Published December 21, 2005, 11:09 AM
Hard disk manufacturer Seagate has agreed to purchase rival Maxtor in a deal valued at $1.9 billion. The new company will retain the Seagate name, but it's not clear if Maxtor products will be rebranded. Seagate believes it can help Maxtor cut costs to the tune of $300 million.
Under the terms of the proposed transaction, Maxtor shareholders will receive .37 shares of Seagate common stock for each Maxtor share they own. In total, Seagate shareholders will control 84 percent of the newly combined company while Maxtor shareholders control the other 16 percent.
Maxtor has been struggling recently to increase revenues, which fell from $4.08 billion in 2003 to $3.79 billion last year. The company also swung from a profit of $128 million to a loss of $182 million. Many analysts believe Maxtor's lack of market share in mobile computers and MP3 players has hurt the company.
Seagate, meanwhile, has seen its business booming. Last year the company pulled in $7.55 billion and profits of 707 million. The company has focused on building smaller hard drives for portable devices, like the iPod Mini.
"Seagate is excited about the opportunity to achieve greater scale, reduce supply chain costs, and leverage combined R&D efforts across a broader product set. With the increased scale of the combined company, we can reduce overall product costs and provide more innovative products at more competitive prices," said Seagate CEO Bill Watkins.
"Together, we will leverage our combined technical resources to deliver to our customers an even more compelling and diverse set of products, and get them to market more quickly and cost effectively," commented Maxtor CEO Dr. C.S. Park.
The transaction is expected to close in the second half of 2006. Seagate's executive team will continue in their roles while Maxtor's Park becomes a director of the new company.
I've looked at a lot of posts, and need to point out that Maxtor’s enterprise class products have 5 years of warrantee coverage Atlas, MaXline, etc. The high end products have a 3 year and there is the Wal-Mart isle series- (CRAP) has a one year. Now explain to me why anyone with any computer common sense would even consider putting a retail unit in a machine is beyond me when you can get an enterprise class product for the same price. As for the merger, Seagate is taking control of Maxtor; Maxtor’s quality should in theory improve. A final point, any electronic device is only as reliable as its weakest component. A supplier has a bad run; the final product has a bad run. And I have to say I'm very happy with my Maxtor MaXline III enterprise class drives with a 5 year warrantee...
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|If two manufacters make 100,000 units and one has a 1 percent failure rate in the field and the other has 10 percent then people should buy the 1 percent one because the odds are in their favor.
People who buy the 1 percent failure unit and get a failure will assume that the quality is bad.
I presume the failure rate with Maxtor is much higher compared with Seagate but this doesn't take into effect the enviroment that they must exist in. If a Maxtor drives are properly cooled while Seagates are not will the Seagates die faster ?
I called Maxtor to ask them how to ensure that my hard drive will have a longer life and he said get a fan on it and of course shutdown the machine when your not using it.
Most low end hard drives are NOT built for 24/7 use.
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|This is getting too dam confusing...I mean Maxtor still sells a line of drives that were originally manufactured by IBM, as well as Hitachi, now Seagate owns part of them...who really cares? If you follow the hard drive manufacturers, it seems everything is directly or indirectly a part of something else. I wonder whether or not they're all the same company sometimes...
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|You people do realize that Maxtor is not going anywhere don't you. There will still be Maxtor drives made and sold just as HP still produces and sells Compaq computers.
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|Well thank God it wasn't the other way around anyway. I've still got a 2gb Seagate that's about 10yrs old and it still spins okay - no problem.
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|I've got a maxtor 8GB that works too. Also have a 207MB WD drive that works and a 1.2GB seagate that works.
What matters is failure rate. I may just be the lucky guy and only two WDC 207MB drives in the universe worked more than a year--so you gotta look at the bigger picture. Working for a Dell callcenter for 2 years has given me the opportunity.
Definately replace more Maxtor drives than any other brand. Partially due to 2 of their models being ridiculous crap though. Seagate seems fine but dell uses more WD and Maxtor than them, so hard to tell. WDC always seems to have less of the "dirty models" in my professional opinion. They did have those 4GB drives that were recalled, and a 10GB drive that fails making a horrendous grinding noise after only two years on average, but Maxtor had many many bad lines--model 6E040L0 the worst ever, due to the %#$@!~ heat it puts out, the 6E020L0 for its poor spindle bearings, another 20GB line gets so hot the controller card varistors melt. The only Seagate issues I've seen were with a 10GB and 20GB model. All I know is that SMART reports the error as an "electrical failure", but little beyond that...remember I primarily dealt with WD and Maxtor though, and mostly with desktop drives not SCSI or laptop drives.
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|Those damn low profile Maxtor drives in the Optipleix GX150/260 lines are the WORST. Nearly 80% of the optiplexes I 'inherited' when I took this job overheated and had the hard drives fail. All of them were the same model of thin maxtor crap.
Buggy
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|Exactly the line I replaced. Some 40GB drives made it to the GX270 too-- remember that "90/90" test Dell has you run? Look at the model: 6E040L0 or 6E020L0, right? See my other posts.
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|Bad news I say, I hate Seagate hard drives, and Western Digital as well. I have had a Seagate drive combust on the work bench, I have had and seen more Western Digitals, and Seagate hard drives fail than any other hard drive. For me, this is a bad thing, I have had to replace a computer lab FLEET of hard drives that were Seagate and Western Digital, that were very new, they all died, one right after the other almost, all simple workstations, they were replaced with Maxtor drives and have not had a single problem since. I would like to mention that the most reliable drives I have ever seen, and the quickest, have been Fujitsu hard drives.
The Competition aspect is also a good reason to see this as bad news, one less independent manufacture, less competition, prices go up, the push for something better drops farther back.
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|You had 10GB WDC drives right? Unfortunately you probably had a "FLEET" of a bad MODEL. Don't blame the MANUFACTURER for that--all manufacturers have bad lines of hard drives, most especially your beloved Maxtor.
Read my post above--you got the bad apples, Maxtor has more hardware failures statistically than any other hard drive vendor. Sorry.
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|I have used both Western Digital and Maxtor hard drives with only minor problems. My brother's 1995 vintage 15 GB Maxtor is still alive today.
Seagate is a local company, with a corporate head quarters jew a few miles away. They might be the biggest of the hard drive makers. The company founder is a gadfly politician; who ran his St. Bernard dog for the US Congress in Pebble Beach. Do a google search of "Friends of Ernest". Enjoy the humor...
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|A 15GB drive in 1995!? That must have cost a pretty penny.
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|When a customer's drive dies and we have to send it to a hard drive data recovery center, I have been told by more than one company that they see more dead Maxtor drives than any other brand name!!
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|Bad models--probably those DiamondMax Plus 20GB and 40GB drives. They sucked.
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|When a customer's drive dies and we have to send to a disk recovery service, more than one has told me they have to recover data from dead Maxtor drives more often than any other brand!
Sorry, duplicated post.
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|Maybe Seagate can get Maxtor drives to be more reliable.
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|Or better... maybe Seagate could learn how to make a reliable hard drive from Maxtor.
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|This is so funny. I work into a computer store and between Fujitsu and Maxtor, I didn't know who was worse. Guranteed for maxtor one day after the warranty was up that freakin drive would fail. Fujitsu or as I call them FUS HITSU if you had a 20 gb one of those it would always make it way back to the manufacturer for replacement. As for seagate never had many problems with them. Seems though Western Digital has the market. Every system we sell we put a Western Digital in. One of the most reliable drives of all time was the Quantum Fireball. I had an old 30 gig that is still running yet bought it back in 2000 when they first came out.
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|This is kind of funny because I have never had a Maxtor , Quantum, or Western Digital go bad, but I have had two Seagates die. And Seagate was more than willing to help if I was willing to pay for repairs (which they would not even estimate a price). In the end it was cheaper to just buy new drives than put up with all the hassle.
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|Someone always gets the s*** end of the stick. With Seagate, the general consensus seems to be that there's less sticks.
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|Both Maxtor and Seagate (especially Seagate) have served me well. That's awesome.
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|I'm a WD fan myself, but of the few experiences with Seagate I've certainly had more good than bad.
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|Seagate is the original gangsta. Their stuff kicks booty.
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|Wow. I have to agree with you again.
I'm starting to get a little nervous.
First Hillary. Now this. =p
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|I hope Seagate don't lower the quality of maxtor. Most of my seagate drives just didnt work after 10 years while the maxtors just kept on going. I have never had a bad maxtor.
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|Whereas those unlucky bas****s with Maxtor drives that died after a year were out of luck and the Seagate crew could still get replacements for free 4 years later...
Anecdotal evidence should *never* take precidence over warranty. Even statistical evidence should be taken with a rather large grain of salt.
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|I recall having 20 bad maxtors in 20 brand new computers (they all died within 3 weeks of each other).
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|i have 2 maxtors and a seagfate, no problems with either, i know seagates are faster and have better warranty
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|Seagate may be better than Maxtor in terms of quality and speed, but they haven't been able to beat Western Digital yet on the desktop. Western Digital's Raptor drives beat the pants off of Seagate. I do like Seagate's newer laptop drives though. Seagate is one of the very few companies that makes 7200rpm 2.5-inch hard drives for laptops.
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|If you want speed....can you say RAID-0?
RAID-0 or RAID-5 is probably cheaper too. :P
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|I like Seagate. I used to think WDC is the best until I received my first Seagate from a Dell system. Their 5 years warranty is unbeatable.
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|Yeah Me too, I have always been a Western Digital fan myself since their old school caviar drives. But latley I havn't seen that "Old School" Quality they used to have :( They're about right along the lines of Maxtor now as far as quality goes. So I went searching around about 2 years ago's, Bought a Seagate 80GB Baracuda, and about a year ago I bought a WD800 80GB HDD, Now the Seagate is running strong! NO problems no issues, the WD Drive is int he trash can as It died on me 2 weeks after it's 1 year warranty was over....
Edit: Also I remember IBM used WD Drives for a long time too, But for the past few years I've noticed a change in their drives, they look like Seagate drives. So I guess everyone is switching from WD to Seagate.
Who here thinks WD will get on the ball and get back in Business to compete???
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|lol I have to reply to my own comment cuz I just got done working on an HP Pavillion with a WD800 HDD in it, and I'm replacing with with a new Seagate Baracuda 80GB. lol Thought I'd share that with you guys haha
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|I have a 20GB WD HD. Apparently it's one of the ones that had lots of problems with its line, but I guess I got lucky?
I have some really old Fujitsu HD's(used for old DOS programs almost daily), and they're still alive and running well after what's getting close to a decade.
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|oh man, I miss Fujitsu! Fujitsu drives where the Sh*t!
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|Seagate warranty and Maxtor's "no-quibble" replacement policy.
Now *that* I can handle.
Just don't reverse that. (Maxtor's warranty and Seagates replacement policy *shudder*)
They gotta stick with the 5 year warranty. It's the only reason many people I know buy from them.
I imagine they're going to drop the Maxtor name completely or offer them as a "value-line" drive.
Ewww...
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|New Seagate Value Drives! **Maxtor Inside** Logo
90 Day replacment warranty!
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|I dont think Seagate would even deign to drop as low as one year on those drives.
At most they'd probably offer a 3-year on the "Maxtor Inside" drives.
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|I’m surprised. I like both Seagate and Maxtor but I thought Maxtor was the larger company and I was under the impression Maxtor sold more drives. Obviously, I was wrong. I’m also surprised to see Seagate doing so good and Maxtor doing so badly!
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|WHYYYYYYYYYYYYYYYYYYY!!!!!!!!!!!!!!!!!!!!!!!!
NOOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!!!!!!!!!!!
This is bad news! BAD!!! MAXTOR IS HORRIBLE!!!!
I love seagate drives....I think I'm gonna cry lol
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|Why bad? Maxtor goes bye-bye, seagate gets bigger... Best warranty in the business.
Got nothing to complain about.
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|There are other drives much worse than Maxtor.
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|Good point! I love Seagate drives because of their lovely 5 year warranty, I'm just afraid they might end up with Maxtor quality lol. 5 year warranty is useless if you gotta send back your HDD every 6 months for a new one cuz it died haha
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|Why is Maxtor going "bye-bye" a good thing? You were never forced to buy them and competition is a GOOD thing. The more companies the better. With less competition prices go up and quality and innovation goes down. So yes, there certainly is something to complain about.
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|lmao...
Competition means squat when one business sells quality drives at decent prices with extended warranties and the other sells "crap on a cable" with virtually no warranty for the same prices.
There are still quite a few drive makers out there, there's no need to worry about a lack of competition just because one of the most notorious players got eaten.
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|Yeah...something tells me, if they do offer the Maxtor drives as a value-line, it''l be without the 5 year. Maybe a 3 year. I still don't think they'd drop to a year.
Win-win. Seagate's normal line remains high-quality with a great warranty and the Maxotr's get a bump in warranty.
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|Yea like Quantum and Maxtor bought them.....
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|LOL agreed!
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|I hope they don't rebrand them so that way I know which drives Maxtor is manufacturing so I can tell what drives NOT to buy. Maxtor drives are HORRIBLE, there's a reason they only offer 12 month warranties on them...because they most often die after 13 months.
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|I have had every single internal Maxtor harddrive I've ever had fail. However, I have an external harddrive that has never even hiccuped. The internal harddrives I have now have a 3 year warranty though, which is nice, but not really a good thing since the last two I've had failed in less than 2 months. Never buying another Maxtor, hopefully Seagate just made that easier.
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|I purchased a computer with a Maxtor HD off ebay. Apparently it worked before being shipped, but by the time I got it it was ready for a low-level format.
Works now though. Maxtor has really weak firmware from what I've heard, and it easily corrupts all your data.
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|I would say this is pretty sad, I still have a 80 gig Maxtor harddrive, that I have abused and it still runs perfect. Maxtor made really "tough" HDs. Guess ill stick with western digital now.
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|Bad news for you bro: http://www.tgdaily.com/2...seagate_acquires_maxtor/
The "Maxtor" name will cease to exist in late 2006. This has caused me to be more die hard Western Digital now...just lost a potential customer Seagate. Can't say it was a bad move overall though I'm only one man.
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|Of all vendors, Maxtor has been the wildcard--some drives are super-dooper stable while others barely last a year.
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