Western Digital to explore separating flash, HDD business amid Elliott push
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Western Digital (NASDAQ:WDC) announced its exploring strategic alternatives, including separating its flash and HDD business.
The announcement comes after activist Elliott Management disclosed a stake last month and pushed for the company to explore separating the company.
âThe Board is aligned in the belief that maximizing value creation warrants a comprehensive assessment of strategic alternatives focused on structural options for the companyâs Flash and HDD businesses,â WDC CEO David Goeckeler said in a statement.
Western Digital (WDC) surged 14.% on May 3 after activist Elliott disclosed a $1 billion, or 6% stake, and called for the company to separate its hard disk drives and NAND flash memory businesses. By separating the businesses, Elliott said WDC could reach $100+ by the end of 2023. 
Elliott last month also offered $1 billion of incremental equity capital into the flash business at an enterprise value of $17 to $20 billion to be used for a spin-off or as equity financing in a sale or merger. 
 âThrough this process, we are actively engaging in a broad range of strategic and financial alternatives that will help further optimize the value of Western Digital, including Elliottâs offer to invest incremental equity capital in our Flash Busines," Goeckeler said in the statement. "We look forward to continuing our constructive dialogue with Elliott as this process unfolds.â
Elliott highlighted last month that WDC's peers Seagate (STX), which has remained a "pure play" HDD player, and Micron (MU) have substantially outperformed WDC since the company acquired SanDisk in 2015. 
In conjunction with the strategic review process, Western Digital (WDC) and Elliott have signed a customary non-disclosure agreement and a letter agreement.
Qatalyst Partners and Lazard are serving as Western Digitalâs (WDC) financial advisors and Skadden, Arps, Slate, Meagher & Flom LLP is serving as Western Digitalâs legal counsel.
The news was earlier reported by the WSJ. 

Also see SA contributor Tech Stock Pro's piece entitled "Western Digital - Splitting The Businesses Will Not Rescue The Stock."