Western Digital is to split into two separate entities, one formed from the NAND flash memory division and the other from the hard drive unit. The move follows the collapse of WD's proposed merger with memory chipmaker Kioxia.
The veteran US drive maker said today that its board of directors had unanimously approved a plan to carve up operations, creating two new public companies that it believes will better position each business to exploit market opportunities.
"Our HDD and flash businesses are both well positioned to capitalize on the data storage industry's significant market dynamics, and as separate companies, each will have the strategic focus and resources to pursue opportunities in their respective markets," Western Digital CEO David Goeckeler said in a statement.
He claimed WD has already laid the groundwork for the split via the creation of separate flash and HDD product business units and separating operational capabilities over the past several years.
Dividing the company will also "unlock significant value for Western Digital shareholders," Goeckeler claimed, by allowing them to "participate in the upside of two industry leaders with distinct growth and investment profiles."
The separation is targeted for the second half of calendar year 2024.
The bifurcation is pretty much the course of action
proposed by activist investor Elliott Management last year, when it complained that Western Digital had not lived up to expectations following the 2016 purchase of SanDisk, a sizable maker of flash memory.
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