Fujitsu this morning said it has struck a deal to transfer its hard drive business to Toshiba. A memorandum between the two will see Fujitsu spin off its storage efforts into a separate company and let Toshiba buy an 80 percent stake in the project, with Fujitsu eventually letting go of the remaining 20 percent. The decision is largely prompted by Fujitsu's potential $112 million loss in the division.
Although the agreement itself will be signed soon, the two expect the actual deal to take place in Toshiba's first fiscal quarter, which starts in April.
Toshiba positions the deal as particularly advantageous in giving it a much stronger position in small hard drives, such as those it builds for notebooks and portable media players. The Japanese electronics firm also sees the plan as an opportunity to branch out into hybrid flash/rotating and pure solid-state drives for servers and other business-class storage.
The shift also creates added competition for Hitachi, Seagate and Western Digital, all of whom are Toshiba's closest rivals.