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Chinese tech company invests heavily in Western Digital

Xinhua, October 1, 2015 Adjust font size:

Chinese technology firm Unisplendour Corp. Ltd. (UNIS) invested about 3.8 billion U.S. dollars in the American data-storage company Western Digital Corp. (WD), to become the biggest shareholder with a 15-percent stake.

UNIS Union Information System Ltd, a wholly owned subsidiary of UNIS in Hong Kong, will buy around 40 million issued shares for 92.50 U.S. dollars apiece, the two companies announced on Wednesday night.

The investment will optimize capital structure at WD, and facilitate future development, according to Steve Milligan, WD president and CEO.

Zhao Weiguo, board chairman of UNIS, lauded the deal as a model example of cooperation between Chinese and American high-tech companies.

The agreement still needs to be approved by supervising agencies.

Gu Wenjun, chief analyst at research company ICWise, told Xinhua that the deal was a smart move for UNIS, particularly for its semi-conductor business, which was made a priority by UNIS recently.

"The agreement with WD is not the first big deal for UNIS and won't be the last, I see more cooperation on the way," Gu said.

UNIS is owned by Tsinghua University, one of China's top colleges. It specializes in information technology and communications.

The company has acquired various businesses and attracted investment recently.

In May, it purchased a 51-percent stake in Hewlett Packard's China-based H3C computing unit for about 2.5 billion U.S. dollars. The deal is expected to be sealed by the end of 2015.

Last year, chip giant Intel bought 20 percent of UNIS' shares for 9 billion yuan (1.42 billion U.S. dollars). UNIS has also acquired the two domestic chip makers in the past three years. Endi