Disk-drive maker Seagate Technology Holdings has reached an agreement to acquire Intevac, a supplier of thin-film processing systems, in an all-cash deal.
The deal is valued at around $108 million (A$170.73 million) and Seagate will pay $4 (A$6.32) a share for Intevac, an approximately 18% premium to Intevac’s Wednesday’s closing price of $3.38 (A$5.34).
Seagate said that the purchase price is also a 41% premium above Intevac’s closing price of $2.83 (A$4.47) on December 11, the day before the company said it had renewed its focus on pursuing strategic options.
Intevac had a market cap of around $91.17 million (A$144.12 million) as of Thursday.
In its most recent fiscal quarter, it reported $28.5 million (A$45.05 million) in revenue, up 59% year-over-year, but posted a $2.17 million (A$3.43 million) net loss.
One of the major drivers for the deal is seen as Seagate’s focus on heat-assisted magnetic recording (HAMR) drives, a technology that Intevac has aligned itself with.
HAMR is reported to improve the “writeability” and storage density of hard drives by applying heat energy.
In December, Seagate announced its first HAMR-based hard drive after a two-decade hiatus from the technology.
In a filing that same month, Seagate said that it had “successfully completed qualification testing” for its HAMR hard drives with “several customers within the Mass Capacity markets, including a leading cloud service provider.”
Seagate’s rivals, Western Digital and Toshiba, are also reported to be working on HAMR-based drives which are reported to be cost effective over solid-state technologies, making them more attractive to public cloud vendors.
For the quarter ended December 27, 2024, Seagate reported sales up 49.5% year-on-year to $2.33 billion (A$3.68 billion).
