Chanos sees downturn in hard disk drive industry

NEW YORK Wed May 8, 2013 4:48pm EDT

NEW YORK May 8 (Reuters) - James Chanos, founder and managing partner of short-selling firm Kynikos Associates L.P., said Wednesday that hard-disk drive companies are likely to decline.

Chanos, noted for predicting the downfall of Enron and a vocal bear on the Chinese economy, said at the Sohn Investment Conference that the hard disk drive business is a "value trap" that is nearing a downturn similar to that of the personal computer business. As examples he cited Seagate Technology and Western Digital Corp.

Western Digital was down 2.5 percent in after-hours trading, while Seagate Technology lost 3.4 percent.