Imation closes acquisition of TDK brand recording media business
ConvergenceAsia staff
02/08/2007

Removable data storage products company Imation has completed the acquisition of the TDK brand recording media business and use of the TDK brand name for recording media products worldwide, for a combination of Imation common stock and cash.

Imation issued to TDK Corporation 6.8 million shares of Imation common stock, representing 16.6 per cent of shares outstanding after issuance of the shares to TDK. Additional cash consideration and customary closing costs and advisory fees brought the total cost to Imation to approximately $260 million. Additional cash consideration of up to $70 million could be paid by Imation to TDK upon future financial performance of the acquired business.

Highlights of the completed transaction include the following:
- Imation purchased a combination of assets and stock of TDK’s recording media business and use of the TDK brand name for current and future recording media products including magnetic tape, optical media, flash media and accessories.

- The TDK brand recording media business operates globally, with major operations in Japan, Europe, the United States, and throughout the Asia Pacific region. A total of approximately 350 TDK employees in the recording media business have transferred to Imation and an additional number of employees will provide transitional services for a period of time. An integration team is assessing the future requirements for the combined business.

- The transaction includes a Supply Agreement providing uninterrupted and continuing supply of TDK brand products to the market. TDK will retain R&D and manufacturing operations for recording media products including audio, video and data storage tape, and Blu-ray optical discs. TDK will supply TDK brand products to Imation as well as non-TDK brand products to its other OEM customers.

- Under terms of the agreement, Imation has a long-term right to use of the TDK brand for current and future recordable magnetic, optical, flash media and accessory products globally. That right is revocable by TDK after 25 years, with a one year wind down. The transaction includes a Supply Agreement for TDK branded magnetic tape products, to include data storage, audio and video tape cartridges.

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