Seagate Announces Intent to Acquire LaCie

We just received word from LaCie PR that Seagate has announced an intent to acquire a controlling interest in LaCie. Seagate is a familiar name for storage products, with hard drives being a primary focus and a history that goes back over three decades. More recently, they have branched out into other related areas with their GoFlex external drives and media players. LaCie on the other hand has been around for 20 years, and they have their fingers in a variety of pies: I first came to know them as a purveyor of high-end displays, but more recently they’ve been heavily involved in the storage market, with some of the first Thunderbolt external drive enclosures like their Little Big Disk and 2Big Thunderbolt.

While Seagate now offers a single drive GoFlex Thunderbolt adapter, it would appear that they’re most interested in acquiring LaCie for their multi-drive enclosures. The press release notes that the two companies have “two highly complementary product and technology portfolios”, with specific mention of LaCie’s premium storage solutions, NAS products, and other software. Besides the technology portfolio, the purchase is also intended to help accelerate Seagate’s growth in the expanding consumer storage market, particularly in Europe and Japan. It’s not just about products and technologies, of course, as mention is made of “relationships with several key retailers”. Mr. Spruch will also join Seagate following the close of the sale and lead the company’s consumer storage products organization.

Seagate has offered to purchase all of the shares from LaCie’s chairman and CEO Philippe Spruch and his affiliate, which would represent a controlling interest with 64.5% of outstanding LaCie shares. Pending government approval, at the close of this transaction Seagate would commence an all-cash simplified tender offer to acquire the remaining outstanding shares, in accordance with the General Regulation of the French Autorité des Marchés Financiers (AMF). Seagate has offered Mr. Spruch €4.05 per share in cash, minus a potential adjustment depending on the cash and debt position of LaCie at closing. This price may also be increased by a possible 3%, resulting in a maximum potential price per LaCie share of €4.17. The offer currently values LaCie at an approximate €146 million/$186 million USD, including acquired net cash of approximately €49/$65 million USD, as of March 31, 2012. The €4.05 per share price represents a premium of 29% to LaCie's average closing stock price over the 30 trading days ended May 22, 2012.

The transaction is expected to be neutral to Seagate's fiscal 2013 earnings per share, and the tender offer is expected to be completed by Q3’2012. The transaction is subject to regulatory approval in the United States, France, and Germany, as well as potential other jurisdictions.