TERM SHEET Private Equity Acquisition of Seagate Technology This term sheet is intended to describe the general terms and conditions of a proposed acquisition of part of Seagate Technology. Parties | Silver Lake Partners and Seagate Technology | Transaction | Silver Lake will purchase (the “Transaction”) the disk drive business of Seagate Technology and $765 million cash | Transaction Price & Method of Transaction | The purchase price to be paid by Silver Lake to the Existing Shareholders
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Seagate Technology Buyout Hard disk drives make up the largest sector of the information storage industry in 1999. The hard disk drive market can be classified into three separate categories‚ desktop‚ enterprise‚ and mobile. The mobile and desktop markets are expected to converge in the long run. While the desktop market represents approximately 58% of the $25 billion total hard disk drive market‚ enterprise margins were nearly double the margins in the desktop sector (10-15%). Since 1997‚ the number
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intensive‚ heavy investments which is not feasible if the Seagate Inc. remains a public company The other capital reorganisations alternatives are involving significant tax liability and considering the present nature of events that Seagate is a public Company‚ the tax liability will result to loss of the wealth of the shareholders where the capital restructuring option involves corporate taxes as well as personal tax liability. The stock of Seagate Inc.‚ experience an adverse value gap‚ Such that the
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Seagate Technology Buyout March 22‚ 2006 By: Rachel Cluck Beth Crocker Heather Preston Jessica Seal Table of Contents Introduction............................................................................3 Objectives ..............................................................................3 Overview................................................................................4 Alternatives – How to Address Seagate’s Low Stock Price ..5 Do Nothing........................
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Seagate Technology* A case (with teaching note) on the role of senior business leaders in driving work/life cultural change. Phyllis Siegel‚ Rutgers the State University of New Jersey The Wharton Work/Life Roundtable A Division of the Wharton Work/Life Integration Project University of Pennsylvania * This research was funded in part by a Sloan Foundation Grant #B1999-76. A note of special gratitude goes to: Alice Campbell‚ Scott Cooper‚ Debbie Hufnagel‚ and Ellen Ernst Kossek for
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“LA ADQUISICIÓN DE SEAGATE TECHNOLOGY” 1. Why is Seagate undertaking this transaction? Is this necessary to divest the Veritas shares in separate transaction? Porque el mercado estaba menospreciando el valor de sus acciones‚ esto ya que aun cuando Seagate Technology poseía gran parte de VERITAS (155 millones de acciones) sólo aumento en un 25% el valor de sus acciones que es nada si se compara con el 200% que aumentó el de las de VERITAS. En sí no es necesario‚ pero al hacer
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Re: Seagate Technology 1. Describe the main terms of the Seagate Technology buyout? Why is Seagate undertaking this transaction? Is it necessary to divest the Veritas shares in a separate transaction? What are other alternative ways to create value? The primary contemplated terms would be to sell Seagate’s disk drive mfg assets including $765M in cash to Suez Acquisition Company controlled by Silver Lake Partners. The purchase would be financed by equity put up by Silver Lake and also by an‚
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number of engineers left IBM (they were known as the "dirty dozen" within IBM) and founded Memorex. Al Shugart‚ one of them‚ later left Memorex and founded first Shugart Associates where the 5 1/4" floppy disk drive was a major product‚ then Seagate Technology‚ which effectively started today’s industry of small hard disk drives. The early drives almost all had linear actuators‚ that is‚ they moved the heads across the disks in a straight line‚ using a carriage with wheels. It was only later that
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“Seagate Buyout” | Case Study Analysis | 1. Why is Seagate undertaking this transaction? Is it necessary to divest the VERITAS shares in a separate transaction? Do the shareholders of VERITAS gain or lose from this transaction? Under the original organizational structure‚ Seagate’s management believed its current stock price is undervalued by the current market and thus not delivering the value to shareholders of Seagate stock. At this time‚ Seagate also held a significant stake in VERITAS
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Finance 448 Pulvino Seagate Technology Buyout Suggested Assignment Questions 1. Why is Seagate undertaking these transactions (the buyout and the stock swap with Veritas)? Who are the winners and losers resulting from these transactions (e.g.‚ Seagate shareholders‚ Seagate management‚ Veritas shareholders‚ Silver Lake Partners)? 2. Who benefits from generic leveraged buyouts? Who loses? Is the rigid disk drive industry conducive to a leveraged buyout? NOTE: For the purposes of questions
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