Western Digital's stock jumps on plan to spin off flash memory unit to shareholders

Western Digital Corp.'s stock (WDC) was up 12.3% in premarket trading on Monday after the San Jose, Calif., data-storage company said it would spin off its flash memory businesses into a separate public company in the second half of 2024. Western Digital will focus on its legacy hard-drive business. The decision to pursue the tax-free spinoff of its flash-memory unit came after a strategic review of its business. "The company's separation will better position each franchise to execute innovative technology and product development, capitalize on unique growth opportunities, extend respective leadership positions, and operate more efficiently with distinct capital structures," Western Digital said in a statement. The company said it "remains open to strategic opportunities that unlock further value in both our HDD and Flash investments and assets." Qatalyst Partners, Lazard and J.P. Morgan as advising Western Digital.

-Steve Gelsi

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10-30-23 0827ET

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