Seagate just bought Maxtor for 1.9B. In their press release, they write:

“Seagate is excited about the opportunity to achieve greater scale, reduce supply chain costs, and leverage combined R&D efforts across a broader product set. With the increased scale of the combined company, we can reduce overall product costs and provide more innovative products at more competitive prices,” said Bill Watkins, Seagate CEO. “We believe this is a strategic combination that will provide value for our shareholders as well as benefits for our customers.”

Personally, the merger is a good thing, although the relative quality of their products may cause future problems in integrating the two. Seagate, for example, offers typically 5 year warranties with an excellent high-end reputation on its disks, while Maxtor hard drives usually are insured for a single year and have a “may break” commodity reputation.

Seagate stock (STX) is up about 2% at time of writing, Maxtor (MXO) is up 51%.

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