Private equity firms in takeover talks with Seagate

Seagate could be the next major technology acquisition of 2010 after the data storage firm confirmed that it had received a preliminary approach regarding a takeover.

Private equity firms TPG and Kolhberg Kravis Roberts are believed to be behind the deal, which would be the largest "leveraged" buyout of the year, according to reports.

Seagate is valued at $6bn (£3.74bn) and the company's stock jumped by 20 per cent to close on $15.25 (£9.49) at the end of trading on Thursday.

The storage firm said in a statement that it is in discussions with "the party that indicated interest", and that its board of directors is evaluating the offer and other strategic alternatives.

"There is no assurance that the company will receive a formal offer or that any transaction will take place," the statement added.

"Neither the company nor its representatives will be providing any additional comments regarding the preliminary indication of interest."

Interestingly, shares in Seagate rival Western Digital rose by 8.9 per cent on Thursday.

Seagate was bought by Veritas Software for $20bn (£12bn) in 2000, but re-entered the public market two years later.

Demand for storage is at an all-time high as data use by consumers and businesses shows no signs of slowing down. IBM reported recently that 7TB of data passes through Twitter alone on a daily basis.

HP and Dell recently concluded a fierce battle to secure storage vendor 3Par. HP's winning bid of $2.35bn (£1.48bn) confirmed the importance of offering premium storage and backup facilities.