Yesterday Seagate Technology and Maxtor Corporation issued a joint announcement stating that they have entered into an agreement where Seagate will acquire Maxtor. The deal is valued at $1.9 billion and will be an all-stock transaction. The buyout has been approved by both boards of directors and is expected to be finalized in the second half of the year, pending approvals from shareholders. Maxtor's shareholders will receive .37 shares of Seagate stock for each share of Maxtor stock they currently hold.
The company will operate under the Seagate name and with Seagate's executive team, and the company will be headquartered in Scotts Valley, California. The impact this merger will have on the hard drive industry remains to be seen, though some are predicting that it will not bode well for smaller competitors such as Western Digital.