Western Digital to Buy Virident Systems for $685M
Western Digital (NASDAQ:WDC) said Monday it agreed to a $685 million cash deal to buy Virident Systems, a move that will add to the company’s flash storage offerings.
Virident makes small, high-capacity memory cards for servers, as well as software with flash-aware network-level storage capabilities.
Western Digital added that Virident will help the company expand its footprint in the market for solid state drives, an increasingly popular choice in devices like laptops. According to research firm IDC, revenue from solid state drives will grow to $7 billion by 2017 from $2.5 billion last year.
The transaction, which has an enterprise value of $645 million, is expected to close in the fourth quarter.
In June, the hard drive maker scored a $340 million deal for Stec (NASDAQ:STEC), another deal aimed at expanding offerings in solid-state drives.
“We have established a competitive position in the enterprise SSD space and with our recently announced acquisitions we are increasing our commitment to become an even more significant player in this high growth segment,” Western Digital CEO Steve Milligan said in a statement.
The company revised is fourth-quarter earnings last month to add that it will log an accrual of $681 million related to a court ruling in favor of rival Seagate Technology (NASDAQ:STX).
Shares were up 28 cents at $65.27 shortly after Monday’s opening bell.