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Conner Acquired By Seagate
|1996||Conner acquired by Seagate|
|Failure of a leading HDD Company|
Why its important
Conner the early market leader in 3.5" HDD's and at one time the world's fastest growing industrial company suffered several product failures leading to its acquisition by Seagate in 1996.
Conner Peripherals shipped its first product in 1987 and as a consequence of its success in the 3.5-inch hard disk drive market was by 1990 the fastest growing company in the history of US commerce The company began experiencing financial difficulties in 1991.
In Sept 1992, Finis Conner hired Tom Mitchell to run the company, with whom he had worked at Seagate.
In 1995 discussing the proposed acquisition by Seagate, Finis Conner stated to financial analysts that the companies only chance to manage supply constraints during a massive component shortage was to join forces with competitor Seagate.
Conner was acquired by Seagate in 1996. The Conner designed high end drives were phased out, and Conner's San Jose facility taken over by a Seagate 2.5 inch drive team, which was largely unsuccessful, and Seagate abandoned the facilities. The Conner headquarters is now occupied by SEMI, the semiconductor trade association.
"America's Fastest Growing Company," Fortune, Aug 13, 1990
"Seagate to Acquire Conner In $1.04 Billion Stock Swap," WSJ, Sep 21, 1995
Seagate and Conner, Joint Proxy Statement, Jan 4, 1996
"Conner: Shortages caused deal," Computer Reseller News, Nov 6, 1995, p. 179
Latest page update: made by tom94022
, Jun 10 2012, 8:30 PM EDT
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|tom94022||Conner History||0||Jun 3 2007, 1:37 PM EDT by tom94022|
Thread started: Jun 3 2007, 1:37 PM EDT Watch
[The following was originally contributed by Bill Carlson to the Event description and then moved to a comment]
Finis Conner and Al Shugart were friends and co-founders of Seagate. Finis, in charge of marketing, eventually saw the need for a smaller form factor and proposed that within Seagate. The Engineering team, led by Doug Mann responded that "anything 3.5" can do, 5" can do better", based on the notion that more surface area of the larger media would always be advantageous for capacity and cost per megabyte. Frustrated, Finis left Seagate, made arrangements with a drive development team in Colorado, and sold the idea of a smaller, cheaper, and faster drive to Compaq. Compaq invested in the new company "Conner Peripherals" and gave it a large initial contract which bootstrapped the operation into the fastest growing company in disk drive history. Finis then hired ex-IBM drive designers led by V.P. Mike ____ to penetrate the more profitable enterprise market, in a new San Jose operation on Zanker Road (now the headquarters of SEMI). Finis also made some tactical errors, one of which was hiring a respected but generally disliked ex-Seagate operations manager Tom Mitchell (fired by Seagate for trying to take over the company from Al Shugart) who ran roughshod over the entire organization, resulting in firings and departures of key personnel. Eventually Finis struck a deal with his ex-partner Al Shugart, and Conner Peripherass was merged into Seagate, with the Scotts Valley design team put in charge of the Conner operation in San Jose. The merger provided Seagate with a 3.5 inch product line, a desktop design team in Colorado, and asian manufacturing facilities. Subsequent commercial failure of the initial Seagate 2.5 inch mobile products from the San Jose design center resulted in closure of that facility, which were later reintroduced with improved designs from the Longmont Colorado operation.
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