Seagate Technology Holdings and Toshiba are competing for TDK’s magnetic-head operations, which could change hands for several billion dollars, Bloomberg reported on 8 October. The bidders make hard drives for a market valued at $23 billion.
Key points
- Toshiba began talks with TDK in the spring; Seagate made a higher offer in the summer.
- TDK supplies magnetic heads to Seagate, Toshiba and Western Digital. Toshiba relies entirely on TDK for the component.
- Executives from the three companies discussed continued head supplies, including a possible joint venture.
TDK supplies all three hard-drive makers
Magnetic heads write and read data on the spinning disks inside hard drives. TDK is the only independent supplier of hard-disk-drive magnetic-recording heads and sells them to Seagate, Toshiba and Western Digital, Briefs.co reported. Control of the business would place a drive maker on both sides of that supply relationship.
Seagate and Western Digital produce some heads themselves but use TDK to supplement production when demand is strong. Toshiba obtains all its heads from TDK. That dependence makes continued access to the component particularly important to Toshiba as it pursues higher drive output.
TrendForce projects Western Digital will hold 48% of the hard-drive market in 2026, Seagate 42% and Toshiba 10%, TrendForce reported. Briefs.co gave TrendForce’s count as about 45% each for Seagate and Western Digital, with Toshiba at roughly 10%.
Demand for long-term, lower-cost storage from AI data centres has lifted hard-drive sales. An acquisition would likely face antitrust scrutiny, and a buyer could gain greater influence over head pricing and competitors’ access to supply.
Toshiba’s capacity plan raises the stakes
Toshiba opened discussions with TDK in the spring, before Seagate submitted a higher bid in the summer. The process is confidential, and the potential deal could be worth several billion dollars.
Toshiba plans to spend ¥60 billion to double its hard-drive capacity by fiscal 2027, AI Affairs previously reported. TrendForce reported that access to TDK’s technology matters to Toshiba’s plans to produce high-capacity heat-assisted magnetic recording drives at scale. The expansion would increase Toshiba’s need for heads as it seeks more data-centre storage business.
Executives from Seagate, Toshiba and TDK met in Tokyo to discuss continued head supplies, including a possible joint venture, Briefs.co reported, citing people familiar with the conversations. The talks were at an early stage and could fall apart. Both bidders also wanted to preserve the option of buying heads from an independent supplier if their bids failed.
Seagate has previously bought businesses serving the storage industry. It acquired thin-film processing systems supplier Intevac for approximately $119 million in 2025 and data-storage technology provider Xyratex for about $376 million in 2014, Stocktwits reported. TDK’s head business would give a buyer direct production capability for a component used by rival drive makers.
TDK weighs its magnetic-head business
TDK is considering a sale as it directs resources towards batteries, passive components and sensors. The magnetic-head business is exposed to swings in hard-drive demand and requires continuing investment as recording technology advances.
TDK’s portfolio plans extend beyond the proposed sale. TrendForce reported that Kaisha Shikiho Online described return on invested capital as one measure guiding investment under TDK’s medium-term plan through fiscal 2026. Magnetic application products had the lowest return on invested capital among its segments, at 4%.
