Seagate has acquired a controlling interest in European rival LaCie, helping to further boost Seagate to the top of the global hard drive and storage market.
Under the agreement, Seagate offered to purchase the shares of LaCie's chairman and CEO, Philippe Spruch, representing 64.5 per cent of the outstanding shares of LaCie.
Although the two businesses have refrained from calling this a merger or an acquisition, in the press release, it could mean big expansion plans for Seagate. Blending LaCie's premium consumer storage products into the fold, matching Seagate's mainstream consumer products, it could make for a much more well-rounded portfolio, overall.
Based in Cupertino, California, Seagate is also using this as leverage to delve deeper into international markets where LaCie might be stronger, such as Europe and Japan.
Although it isn't mentioned in the release, this also reflects on Seagate's surge in the hard drive storage market in the last few months as many of its competitors have slipped, following the floods in Thailand last year.
Seagate has been one of the lucky ones in the aftermath of the disaster and the hard drive shortage that ensued. Along with strong earnings for the second fiscal quarter, a report from IHS iSuppli recently posited that Seagate actually got a boost from the natural disaster. Which is mainly thanks to geography, as Seagate's HDD manufacturing plants are on higher ground, in comparison to Western Digital, which saw its facilities engulfed by the floods.
Seagate's momentum continued through the third fiscal quarter, with solid earnings and revenue announced in April.
However, this deal might not have any effect on Seagate's bottom line immediately, as it is expected to be neutral to Seagate's fiscal 2013 earnings, per share. The agreement is also still subject to approval in several markets — namely the United States, France and Germany — over antitrust filings and foreign investment.