Hungry and ambitious Western Digital Corp has signed a letter of intent to acquire Sunnyvale, California personal graphics subsystems manufacturer Verticom Inc in a share exchange offer valuing the target at $12m. Some 20% of the Western Digital shares paid will be held in escrow by Vericom to indemnify Western for representations and warranties. Completion is expected for July after which the Verticom subsidiary will continue to operate as a separate entity from its Sunnyvale headquarters. Western Digital looks for the Verticom products to fill in the high end of its graphics line, complementing the medium-resolution family it took on board with its acquisition of Paradise Systems in 1986. Verticom designs its own graphic chips.
