History 2000: Imation to Be Sold?

Is Imation’s chairman and CEO Bill Monahan throwing in the towel?

Financial results for 3FQ00 closed in September are not likely to be good, with revenue down by 16% compared to 3Q99, 6% compared to 2Q00, due to weaker demand for its mature product lines, pricing pressure, lower SuperDisk drive sales and the negative effect of the low Euro.

In addition to the 10% headcount reduction planned before the end of 2001, which translates into nearly 470 people, Imation has announced that it engaged the investment banking firm of Goldman, Sachs & Co. to explore strategic alternatives, such as financial restructuring, stock repurchases, spin-offs, joint ventures and business combinations.

During a conference call, Monahan seemed frustrated that the long term value of Imation had not been recognized by Wall Street. Since it disentangled itself from 3M’s skirts, the company has been far from convincing.

We’ll have to wait to see what becomes of this US firm, one of the most prominent institutions in the history of storage media, and that currently has almost all its competitors in Japan.

This article is an abstract of news published on issue 153 on October 2000 from the former paper version of Computer Data Storage Newsletter.