Due to the decline in storage demand, the armor and Western Digital speed up merger negotiations

CTOnews.com, May 15 (Reuters)-Japan's Armor and American chipmaker Western Digital are speeding up merger talks and finalizing the deal structure due to falling demand for flash memory, Reuters said. The industry believes that the merger of the two sides' business can improve their competitiveness in the face of competitors such as Samsung Electronics of South Korea.

According to a plan being developed, the combined entity will be 43 per cent owned by Shexia, 37 per cent by Western Digital and the rest by existing shareholders of the two companies, according to one of the sources. Both sources declined to be named because the talks were held in private.

Sources said that the two sides are still in the negotiation stage, no decision has been made, so the details may change. It is worth mentioning that if the two sides merge, they will also need to open antitrust reviews in several countries, including the United States and China.

A spokesman for the armour declined to comment on speculation. Western Digital didn't immediately respond to a request for comment.

I believe that no one is too strange to these two companies. Kioxia, formerly known as Toshiba memory, was sold by Toshiba in 2018 to a consortium led by Bain Capital for $18 billion (CTOnews.com Note: currently about 125.28 billion yuan). Plans for an initial public offering have been shelved due to the deterioration of the flash market, and Toshiba still owns 40.6% of the company.

According to reports, Kioxia and Western Digital held merger talks in 2021, after which they reached an impasse over a series of issues, including valuation differences. Bloomberg reported in January that the two sides had resumed merger talks.