14 DAY TRIAL // Hitachi, Japan's biggest electronics conglomerate, is rumored to think of selling its hard-disk manufacturing units. Recent news emerging from the hard-disk manufacturer says that Hitachi is currently in talks with U.S. private equity firm Silver Lake about the possibility of selling it a stake in its hard drive unit.
Silver Lake is concerned with making a large-scale investment in technology-development companies. Its main focus is to come up with a solution to help Hitachi's business. The hard-disk manufacturer has been taking into account the possibility of selling a stake in their storage business.
The two companies have begun negotiations, but they have not agreed upon anything yet. Company officials stated that Hitachi was "studying various measures to improve its hard disk drive business". Japanese newspaper "Nikkei" reported today that Hitachi is in talks to sell half of its hard-drive manufacturing business.
"The report says it's not the sale of the entire HDD business, and uncertainties about the deal remain, but still it would mark a step forward in Hitachi's revival," said Takashi Ushio, head of the investment strategy division at Marusan Securities.
Although Hitachi is alleged to sell its hard-drive units, the company's shares closed 3.6 percent higher. This is the result of investors' appreciating the company for taking drastic measures with poorly performing units.
The company issued a press release to put an end to the emerging rumors. "No decision on such a sale has been made,'' Hitachi said in a filing to the Tokyo Stock Exchange. Elizabeth Hanahan, a spokeswoman for Silver Lake, declined to comment on the report.
Hitachi's hard-drive business has been losing money since the company acquired IBM's hard-drive manufacturing units. The company estimates an operating loss of $325 million in the hard drive business for this year.