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OCZ and Toshiba deal agreed, assets to be bought for $35m

by Mark Tyson on 3 December 2013, 12:15

Tags: Toshiba (TYO:6502), OCZ (NASDAQ:OCZ)

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Last week we reported upon the OCZ bankruptcy and an offer it received from Toshiba. The deal could only be done if several conditions were met and now it has been confirmed that the deal is indeed going ahead. Toshiba will acquire substantially all of OCZ's assets in a chapter 11 bankruptcy proceeding for $35M, subject to an auction and approval by the bankruptcy court.

In a press release we are told that the acquisition “will provide Toshiba with access to OCZ's proprietary controllers, firmware and software, as well as the teams responsible for bringing these solutions to market, in addition to OCZ's established brand and sales channels”. Also during the transitionary period Toshiba Corporation will provide financing to OCZ to make sure it has the capital and flash memory supply to continue doing business. However we haven’t got an official statement yet about warranties and support after the acquisition completes.

Ralph Schmitt, CEO of OCZ, made a statement about his firm’s difficulties leading up to this $35 million deal: “The combination of NAND flash supply constraints and credit issues have impacted our ability to satisfy the demands of our customers; this combined with increased pricing pressure in our industry have contributed to our on-going operating losses.” Schmitt added that he thought that the Toshiba deal was the best way forward, “We have been working diligently on this partnership with Toshiba and we believe that this is the best outcome under our current corporate conditions.”

As mentioned in our prior analysis of Toshiba’s acquisition of OCZ, the bringing in-house of controller, firmware and software from OCZ will help in Toshiba’s vertical integration and competitiveness in the SSD market. Corporate Vice President of Toshiba, Mr. Seiichi Mori, said as much in his prepared statement; “the combination of our leading NAND technology with OCZ's SSD expertise will allow us to further strengthen Toshiba's SSD business,” he said. “We value OCZ's SSD business and technology in both the consumer and enterprise markets, and we are confident that it will reinforce our capabilities and help us to secure leadership in the SSD market,” concluded Seiichi.

The sale is expected to complete within 60 days. The $35 million deal is not a lot of money for a company the size of Toshiba and is an especially good deal if you consider that OCZ spent nearly as much for Indilinx alone back in 2011.

HEXUS Forums :: 13 Comments

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Very good business for Toshiba
Bargain buy this is! :)
Hopefully they will be able to improve on the customer relations and shed some of the negative PR OCZ has
So will OCZ now be referred to as TOCZ ?

Also next time a new chipset comes along that beats indilinx, they need to use that new chipset instead of stubbornly sticking with indilinx - This is the only way they can stay in the game as far as I can tell.
I don't know what Toshiba is like as a business so right now it appears to be the best possible outcome to a bad situation for OCZ.
everyone keeps their jobs.
Toshiba gain indefinite access to OCZ's controllers
OCZ gain indefinite access to Toshiba's chips
It's a real shame what's happened to OCZ though, i look at my PC with it's DDR2 OCZ Reaper RAM, back when OCZ was a market leader and it could (should) be there still.
It used to be the OCZ SSD's that were among the best, but they got muscled out by the high earners with huge R&D like Samsung.