Maxtor buys Quantum

Hard drive maker Maxtor announced today that it will buy its struggling competitor Quantum HDD, Quantum's hard drive division, for stock estimated to be worth $1.3 to $2.3 billion. The merged business will be known as Maxtor Corporation and is expected to leapfrog over its biggest competitor and market leader, Seagate Technology. It will produce more than 50 million hard drives a year and the merger will reportedly save the new company from $120 million to $200 million annually. Though the disk drive business has suffered falling profits in recent times, new markets such as digital VCRs and network servers could reverse industry fortunes.

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