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Western Digital, Kioxia deal makes ‘a lot of sense,’ says Deutsche Bank
The Fly

Western Digital, Kioxia deal makes ‘a lot of sense,’ says Deutsche Bank

After the market close, Bloomberg reported that Western Digital and Kioxia have restarted talks to merge the two companies into a public traded company, Deutsche Bank analyst Sidney Ho tells investors in a research note. The analyst says the news does not come as a total surprise given Western Digital and activist investor, Elliott Investment Management, have been conducting a strategic review since June 2022. Strategically, it would "make a lot of sense" given Western Digital and Kioxia are long-time joint venture partners for flash memory manufacturing at various locations in Japan, contends Ho. He believes the transaction, if completed, should be positive for Western Digital’s share price, saying the current share price is pricing in almost no value for its flash business. Ho keeps a Hold rating on the name with a $40 price target.

Published first on TheFly

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