WSJ: Western Digital Wants to Acquire Kioxia for $20 Billion

Memory manufacturers Western Digital and Kioxia would like to merge. The two have been working together in a joint venture for decades. WD would like to pay for the merger with shares worth 20 billion dollars, converted about 17 billion euros.

WD is in advanced talks with Kioxia, according to The Wall Street Journal. That is the former Toshiba Memory. Sources familiar with the matter say talks have been going on for a long time and their intensity has grown in recent weeks. A deal could be closed by mid-September. If the merger goes through, the combined company would be led by WD CEO David Goeckeler.

According to the business newspaper, it is not yet certain that the merger will actually go through. Kioxia would also consider other options, such as an IPO or a takeover by another company. According to WSJ, Micron was also interested in Kioxia, but it is said to have cooled down. An acquisition of Kioxia requires approval from the Japanese government.

The American Western Digital and the Japanese Kioxia have been working together on memory chips for decades. In 2017, the joint venture between the two companies was extended until 2029. The merger would allow the group to compete better with Samsung. It is the world’s largest manufacturer of nand memory.

According to TrendForce figures, Samsung has 34 percent of the NAND memory market. Kioxia is in second place with 18.3 percent and WD follows with 14.7 percent. If the two companies merge, they would be roughly on par with Samsung. Consolidation has been taking place in the memory manufacturing market for some time. Last year, Intel sold its nand memory division to SK Hynix for $9 billion.

Mergers and acquisitions in the nand industry