Seagate to Acquire LSI’s Flash Businesses From Avago

  Seagate to Acquire LSI’s Flash Businesses From Avago

Accelerates Seagate’s Entrance into PCIe Market and Strengthens SSD Controller

Business Wire

CUPERTINO, Calif. & SAN JOSE, Calif. & SINGAPORE -- May 29, 2014

Seagate Technology plc (NASDAQ: STX), a world leader in storage solutions, and
Avago Technologies Limited (NASDAQ: AVGO), a leading semiconductor device
supplier to the enterprise storage, wired, wireless and industrial end
markets, today announced that they have entered into a definitive asset
purchase agreement under which Seagate will acquire the assets of LSI’s
Accelerated Solutions Division (“ASD”) and Flash Components Division (“FCD”)
from Avago for $450 million in cash.

The acquisition strengthens Seagate’s strategy to deliver a full suite of
storage solutions, providing Seagate with established Enterprise PCIe flash
and SSD controller capabilities to deliver solutions for the growing flash
storage market. LSI’s ASD business, which is the second largest player in the
PCIe flash space, offers a highly differentiated enterprise-grade PCIe flash
solution focused on the high-growth cloud and hyperscale markets. LSI’s FCD
business, led by its SandForce SF2000 and SF3700 controller products, is
driving a multi-product roadmap to address volume markets.

“Seagate is committed to providing our customers with a complete range of
storage solutions, and this acquisition will significantly enhance our flash
storage offerings to supplement our existing portfolio,” said Steve Luczo,
Seagate chairman and CEO. “LSI’s ASD business has the broadest PCIe flash
product offering and intellectual property in the market today and the FCD
business has best-in-class SSD controllers with proven support for a wide
range of applications. This acquisition immediately boosts Seagate’s range and
depth of flash storage capabilities today, and these teams bring to Seagate
the expertise to accelerate our roadmap in this important and growing market.”

In fiscal 2015, Seagate would expect the combination of its enterprise SSD
product line and these SSD Controller families to generate revenues of at
least $150 million and be slightly accretive to the company gross margin with
operating margin headwind of $30 to $40 million. As Seagate drives operational
synergies and leverages its SSD technology into its product portfolio, the
company would expect the operating margin contribution from its SSD business
to be neutral to positive in fiscal 2016 and beyond.

The transaction is expected to close in the third quarter of calendar year
2014, subject to the satisfaction of customary closing conditions and the
receipt of certain regulatory approvals, including those required by the
Hart-Scott-Rodino Antitrust Improvements Act.

About Seagate

Seagate is a world leader in hard disk drives and storage solutions. Learn
more at Seagate and Seagate Technology are registered
trademarks of Seagate Technology LLC.

About Avago Technologies

Avago Technologies is a leading designer, developer and global supplier of a
broad range of analog, digital, mixed signal and optoelectronics components
and subsystems with a focus in III-V compound semiconductor design and
processing. Backed by an extensive portfolio of intellectual property, Avago
products serve four primary target markets: wireless communications, wired
infrastructure, enterprise storage, and industrial and other. For more
information, visit Avago’s

Follow Avago on Twitter at on Facebook at

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, each as amended, including, in particular, statements
about our plans, strategies and prospects and estimates of industry growth for
the fiscal quarter ending June 27, 2014 and beyond. These statements identify
prospective information and include words such as “expects,” “plans,”
“anticipates,” “believes,” “estimates,” “predicts,” “projects” and similar
expressions. These forward-looking statements are based on information
available to the Company as of the date of this press release and are based on
management’s current views and assumptions. These forward-looking statements
are conditioned upon and also involve a number of known and unknown risks,
uncertainties, and other factors that could cause actual results, performance
or events to differ materially from those anticipated by these forward-looking
statements. Such risks, uncertainties, and other factors may be beyond the
Company’s control and may pose a risk to the Company’s operating and financial
condition. Such risks and uncertainties include, but are not limited to: the
uncertainty in global economic conditions, as consumers and businesses may
defer purchases in response to tighter credit and financial news; the impact
of the variable demand and adverse pricing environment for the flash storage
market, including PCIe flash and SSD controller solutions, particularly in
view of current business and economic conditions; dependence on the Company’s
ability to successfully qualify, manufacture and sell its flash storage
products, including PCIe flash and SSD controller solutions, in increasing
volumes on a cost-effective basis and with acceptable quality; the impact of
competitive product announcements; and the Company’s ability to achieve
projected cost savings. Information concerning risks, uncertainties and other
factors that could cause results to differ materially from the expectations
described in this press release is contained in the Company’s Quarterly
Reports on Form 10-Q filed with the U.S. Securities and Exchange Commission
(the “SEC”) on January 28, 2014 and April 29, 2014, and the Company’s Annual
Report on Form 10-K filed with the SEC on August 7, 2013, the “Risk Factors”
section of which is incorporated into this press release by reference. These
forward-looking statements should not be relied upon as representing the
Company’s views as of any subsequent date and the Company undertakes no
obligation to update forward-looking statements to reflect events or
circumstances after the date they were made.


For Seagate Technology
Media Relations:
Brian Ziel, 408-658-1540
Investor Relations:
For Avago Technologies
Investor Relations:
Ashish Saran, 408-435-7400
Press spacebar to pause and continue. Press esc to stop.