This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Seagate Nixes Going-Private Plan

Stocks in this article: STX WDC

Seagate's after-market share price has been added to this story.

SCOTTS VALLEY, Calif. ( TheStreet) -- Seagate (STX) has ended discussions with private equity firms about taking the company private, explaining that the likely valuation was not in the best interest of the storage specialist and its shareholders.

Shares of Seagate were halted this afternoon prior to the announcement, which was made after market close. The company's stock closed down 3 cents, or 0.22%, at $13.86 in regular trading.

Seagate's stock, however, slipped further when trading resumed, falling 86 cents, or 6.2%, to reach $13. Rival Western Digital (WDC) was also down in extended trading, dipping 37 cents, or 1.1%, to $33.35.

"We appreciate the interest shown by the private equity firms and our dialogues with them were extensive and thoughtful," explained Steve Luczo, Seagate's CEO, in a statement. "However, management and the Board have chosen to cease discussions concerning a private equity-led leveraged buyout. Given the strong debt markets, improving business conditions and other financing options, Seagate has initiated a plan to further optimize its capital structure to maximize shareholder returns."

Seagate's board also authorized a $2 billion share repurchase after market close. According to Seagate, the repurchase will be funded through a combination of cash on hand, future cashflow from operations and "potential alternative sources of financing."

Additionally, the hard drive maker gave fiscal second-quarter guidance, predicting revenue of at least $2.7 billion and a gross margin of at least 19.5%. Analysts surveyed by Thomson Reuters are looking for sales of $2.7 billion and earnings of 29 cents a share.

Chatter about Seagate's long-term plans has swirled around the company for months. In September Bloomberg reported that Seagate had been in failed talks with TPG Capital and Silver Lake about taking the company private, causing a significant spike in the company's shares.

Seagate, which describes itself as the world's largest manufacturer of hard drives, has a market cap of $6.55 billion.

--Written by James Rogers in New York.

>To follow the writer on Twitter, go to

>To submit a news tip, send an email to:

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs