Funes the Memorious

15 October 2010 By Robert Cyran Follow @rob_cyran

The disk drive maker may look a natural LBO candidate. It has been one before, and its $7.1 billion enterprise value is cheap at less than four times estimated EBITDA. Yet past may not be prologue. Fastgrowing tablet devices could easily swipe more of Seagate s future value.

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Seagate Technology, a maker of disk drives, said on Oct. 14 it is in preliminary discussions with an unidentified suitor about taking the company private, and had hired Morgan Stanley and Perella Weinberg to advise it. Reuters reported that private equity firm TPG was involved in the talks.

The company has a market capitalization of $7 billion, along with $2.6 billion of cash and $2.5 billion of debt. The company was taken private in 2000 by a consortium containing Silver Lake Partners and TPG. It went public again two years later.

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