Although China postponed the approval deadline for Toshiba to sell its storage business, the Chinese government approved the acquisition led by Bain last week.
Bain and Toshiba jointly announced on Thursday that they are planning to complete the transaction on Monday (June 1) after they have been approved by Chinese and European regulators. After the transaction was postponed in March this year, Toshiba has stated that it will formulate Emergency plan to prevent the transaction from being approved.
The deal was worth US$18 billion, and Bain’s consortium includes several companies that want Toshiba's flash chip supply, including Apple, Dell, Kingston, Seagate, SK Hynix, and Western Digital. Some time ago, Western Digital had been Opposes the sale of the company’s joint venture with Toshiba’s flash chip factory. In December 2017, Western Digital agreed with Toshiba and agreed to join the consortium.
Toshiba’s chip division is the world’s second-largest flash chip company after Samsung. Insiders believe that Western Digital can now obtain a stable partner, while systems and equipment manufacturers such as Apple, Dell and Kingston can also be directly Get Flash memory supply. Similarly, Seagate will also get some direct supply for its products, SK Hynix may get some flash memory technology.
Since 3D flash memory products account for the majority of the market, and new supply in the Asian market will increase, flash memory prices are expected to decline at the end of this year after experiencing price increases in 2016 and 2017. Both consumer electronics and computer companies use high-performance flash memory. Instead of traditional hard drives, it is important for these companies to ensure the supply of such products. However, long-term storage will still be dominated by traditional hard drives for some time.
With the completion of this transaction, competition in the flash memory sector will not only decrease, but will increase. As flash memory is already similar to commodities, conventional industry consolidation will be reversed. With the rise of China's flash memory manufacturers, competitors also Will increase further.