Seagate spends $119 million to acquire Intevac, increases HAMR hard drive layout
Feb 14,2025
Seagate plans to spend $119 million to acquire sputtering equipment manufacturer Intevac, which produces tools for coating thin films on hard drive disks.
Seagate and Intevac have reached a final agreement, and Seagate will acquire Intevac in an all cash transaction of $4 per share.
Intevac will pay a one-time special dividend of $0.052 per share, making the transaction worth $4.102 per share to Intevac shareholders. This is 45% higher than Intevac's closing price of $2.83 per share on December 11, 2024, when Intevac stated that it was seeking strategic options. When TRIO's efforts to expand its glass substrate coating business were halted, Intevac encountered serious problems. The company has decided to return to its core HDD sputtering equipment business and is seeking buyers or partners.
As Seagate increases production of HAMR (Heat Assisted Magnetic Recording) drives, the company needs more HAMR sputtering capability. Wedbush analyst Matt Bryson said that this deal can "reduce Seagate's capital costs as it requires updating equipment to adapt to HAMR
Matt Bryson also stated that this transaction may hinder Toshiba and Western Digital's entry into HAMR technology, as it reduces the availability of sputtering equipment that they may not necessarily be willing to purchase from Seagate. Western Digital plans to launch the first batch of HAMR hard drives by the end of 2026, but mass production is expected to take until 2027.
The transaction is expected to be completed by the end of March or early April 2025, provided that customary closing conditions are met.
Seagate and Intevac have reached a final agreement, and Seagate will acquire Intevac in an all cash transaction of $4 per share.
Intevac will pay a one-time special dividend of $0.052 per share, making the transaction worth $4.102 per share to Intevac shareholders. This is 45% higher than Intevac's closing price of $2.83 per share on December 11, 2024, when Intevac stated that it was seeking strategic options. When TRIO's efforts to expand its glass substrate coating business were halted, Intevac encountered serious problems. The company has decided to return to its core HDD sputtering equipment business and is seeking buyers or partners.
As Seagate increases production of HAMR (Heat Assisted Magnetic Recording) drives, the company needs more HAMR sputtering capability. Wedbush analyst Matt Bryson said that this deal can "reduce Seagate's capital costs as it requires updating equipment to adapt to HAMR
Matt Bryson also stated that this transaction may hinder Toshiba and Western Digital's entry into HAMR technology, as it reduces the availability of sputtering equipment that they may not necessarily be willing to purchase from Seagate. Western Digital plans to launch the first batch of HAMR hard drives by the end of 2026, but mass production is expected to take until 2027.
The transaction is expected to be completed by the end of March or early April 2025, provided that customary closing conditions are met.