Western Digital yesterday announced they will separate the HDD storage business and flash memory storage into two separate companies. The action was taken after plans to merge with Kioxia fell through after receiving opposition from their shareholder SK Hynix.
The company ran into trouble after flash memory prices plummeted post-pandemic due to reduced demand. The market now has a memory dump that has to be sold at a lower price. This is the same issue faced by Samsung since the beginning of this year.
Through a merger with Kioxia, a company from Japan, Western Digital wants to establish a company that controls 1/3 of the flash memory market in order to control prices. SK Hynix as an investor in Kioxia opposes this merger because it will affect their memory business.
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