Samsung has announced a deal with storage specialist Seagate that sees the company take over its ailing hard-drive division in exchange for equity worth $1.375 billion.
The announcement comes after reports claimed that Samsung was hoping to make $1.5 billion off the sale of its loss-making magnetic storage arm, but that it would accept as little as $1 billion in order to stem the inexorable flow of cash from the business unit.
The deal with storage giant Seagate will see the company take Samsung's hard-drive arm on and combine it with its own, giving Samsung a chunk of equity in the firm and extending a licensing agreement that will see Samsung provide Seagate with chips for its solid-state and hybrid storage product.
It's a good ending for Samsung: the company gets rid of a division which, given it is increasingly concentrating on its solid-state storage arm, it was struggling to make use of, and receives half the $1.375 billion payout in cash with the other half provided in stock.
Samsung products that still use mechanical hard drives, such as its popular laptop lines, will be supplied with Seagate drives in future production runs, the company has confirmed. An as-yet unnamed Samsung executive will also be appointed to Seagate's board, to oversee the company's interests following the agreement.