California-based hard disk manufacturer Western Digital has received conditional approval from the European Union to go ahead with its planned purchase of Hitachi Global Storage Technologies for $4.3 billion. However, as part of the agreement WD must sell several of its current manufacturing facilities, with commissioner Joaquin Almunia saying that these sales "will ensure that competition in the industry is fully restored before the merger is implemented." Hitachi GST was formed following the merger of IBM and Hitachi's hard drive businesses in 2003, and produces a range of hard disk and solid state drives.
The move will give WD an extra 17.3 percent market share on top of its own current 40, allowing the company to overtake Seagate as the world's largest hard drive manufacturer. The EU's concerns over lack of competition come after Seagate and Samsung's "strategic alignment" earlier in the year, leaving WD and Seagate with over 70 percent of the market collectively. The deal isn't finalized yet, as WD must still receive approval for the sale of its current facilities once a buyer is found, but this decision paves the way for the acquisition to go ahead.