Investor Jitters a Factor in Failed Seagate Deal
A few years ago, former Seagate Technology PLC Chief Executive Bill Watkins made an analogy comparing the hard-disk industry to Rodney Dangerfield.
“I think it’s unfair not to respect a commodity,” Watkins told Newsweek in 2007. “There’s a tremendous amount of technology in this commodity.”
Yet for the most part, investors have given the hard-drive business, with its razor-thin profit margins, short shrift. A valuation debate, plus a nagging fear about the potential obsolescence of hard disks, may have been the two biggest factors in Seagate’s failure to reach a deal to go private.
Most analysts, however, believe that the deal collapsed purely over price.
