Watkins: After doing due diligence, [we found] they're in better shape than most people realize. Historically, when deals have been done in this industry, people have gone out to acquire some sort of product road map, technology or specific business. This is not what this is about. We're very comfortable with our product road map and very comfortable with our manufacturing and platforms and strategy.

This is really about bringing over the Maxtor revenue and leveraging it through our infrastructure. We get tremendous scale of value from that. On the gross margin side, as we layer this revenue over our fixed cost, we get an efficiency there. If you look at the [operating expenditures], we believe in the combined company we can eliminate about US$300 million in expense, getting tremendous leverage out of our engineering resources. One way to think about this is, in a sense, we're buying revenue and leveraging it through our operating matrix.

CW: Where will this US$300 million in savings come from?

Watkins: I believe I can run the combined company with about 25 percent more spending than I currently do at Seagate.

CW: When do you expect to see this deal close?