Seagate Spikes On Buyout Talks (STX, HTCH, XRTX, STEC, NTAP, SNDK)
The data storage sector was in focus on Friday after Seagate Technology (STX) announced that it received a preliminary indication of interest regarding a going private transaction. The company did not name its suitor, but Bloomberg reports that private equity firms TPG Capital and KKR are in talks to buy the disk-drive maker, citing anonymous people with direct knowledge of the discussions. The report indicates that the firms are considering an offer of about $16 per share, which would represent a 26% premium to Thursday’s closing value, and would put Seagate’s total value at $7.55 billion.
At the end of the second quarter, 11 13F-filing asset managers counted Seagate shares among their top-15 U.S.-listed equity holdings, ranking the stock among the top-five Pro favorites in the Data Storage Stocks Index.
As of Thursday’s close, the Index had already outperformed the S&P 500 by 10% over the last month, and with Seagate advancing by 18% in pre-market trading, components appear set to rally into the weekend. Hutchinson Technology (HTCH), Xyratex (XRTX), STEC, Inc. (STEC), NetApp (NTAP), and SanDisk (SNDK) are all among pre-market winners this morning.
It will be interesting to see where Seagate and its data storage peers go from here. Investors can track the Data Storage Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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