TOKYO (Reuters) – Western Digital Corp and Japan’s Kioxia Holdings have terminated their talks to create one of the world’s largest chipmakers, the Nikkei newspaper reported on Thursday.
According to the newspaper, the companies were unable to reach an agreement on terms with Bain Capital, which is the major shareholder of Kioxia. However, the source of this information was not disclosed.
Both Western Digital and Bain Capital have yet to respond to Reuters’ requests for comment on the matter.
Following this news, Western Digital’s shares dropped by 12%.
The merger between the two companies was being pursued as a response to the global chip glut and sluggish demand for flash memory chips. The challenging market conditions have increased the pressure on chipmakers to consider consolidation.
Since 2021, Kioxia and Western Digital have been engaged in merger talks, although negotiations have frequently hit roadblocks due to various issues, including disparities in valuation.
David Dolan and Aditya Soni report from Bengaluru; Shweta Agarwal edits the article.
