Activist firm Elliott pushes Western Digital to split its businesses

:Elliott Management on Tuesday disclosed it held a stake of nearly $1 billion in Western Digital and pushed the company to conduct a strategic review and split off its flash-memory business.

Six years ago Western Digital paid $19 billion to buy SanDisk, boosting its ability to make flash memory storage chips used in smartphones and tablets. But operating two very different businesses as part of the same company has held it back, operationally, financially and strategically, Elliott wrote.

Western Digital makes hard drives, USB drives and memory cards. If it reverts to concentrate on its hard drives businesses, its stock price could surge to at least $100 a share by the end of next year, Elliott forecast. A"full separation of the Flash business can allow both HDD and Flash to be more successful and unlock significant value," the letter said.

Western Digital said it would"carefully" consider Elliott's ideas and agrees that it is an"excellent, yet undervalued, company." The company also said it has"explored a range of options to unlock and deliver long-term value and we will continue our ongoing dialogue" with shareholders.

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