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Seagate Pressured by Registered Secondary

Its 82% owner will sell 60 milliion shares.


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shares slipped in premarket trading after its biggest holder filed to sell 60 million shares in an underwritten secondary.

SAC Holdings, which was formed in 2000 to take Seagate's hard-drive and other hardware businesses private, will reduce its stake in the publicly traded unit to 67.6% from 82.1%.

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The shares were down 38 cents, or 2%, to $17.80 on the Instinet premarket session. They started trading at about $11.50 in early December 2002.

The decline came despite Seagate's announcement Friday that it would raise its quarterly dividend to 4 cents from 3 cents. The company also raised its fourth-quarter guidance to earnings of 28 cents a share on revenue of $1.53 billion to $1.56 billion. Analysts polled by Thomson First Call were estimating earnings of 28 cents a share on revenue of $1.54 billion.

The company said its fourth quarter usually experiences the highest price erosion and largest decline in unit shipments of any quarter, particularly in personal storage products.

"The company's experience for the quarter ended June 27, 2003, with respect to unit sales of personal storage products is consistent with this trend, although it has enjoyed higher levels of enterprise unit sales than was anticipated," Seagate said.