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Digital West (NASDAQ:WDC) and Kioxia Holdings are advancing discussions on a possible merger with a rough structure that includes a dual listing in Japan as potential parties to the deal.
Western Digital (WDC)) would spin off its flash business and merge it with Kioxia, creating a new publicly traded company in the US, under current terms being discussed, according to a Bloomberg report on Friday night, which quoted well-known people. The company would also have a second share listing in Japan.
Western Digital (WDC) management would likely run the combined company, according to the report. The parties are trying to finalize an agreement in the coming months, although it is possible that no agreement will be reached.
The latest update comes after Bloomberg reported earlier this month that the memory chip company had resumed merger talks with Japan’s Kioxia. Talks resumed late last year.
The reports come after initial talks between the companies for a merger stalled in October 2021. The WSJ and others first reported in August 2021 that Western Digital was close to an agreement to merge with Kioxia in a transaction. which could be worth more than $20 billion.
The news also comes after Western Digital (WDC) announced in June that it was exploring strategic alternatives, including separating its flash and HDD business, which followed after activist Elliott Management disclosed a stake in May and pushed for the company will explore the separation of the company.
Western Digital (WDC) is set to report fiscal second quarter results on January 31.
