Fujitsu is reportedly in talks with Wstern Digital to sell its hard-disk-drive business the Nihon Keizai Shimbun newspaper reported on Wednesday. However, Fujitsu denied that it was now approaching an agreement or arranging a sale. "This article is not based on information released by Fujitsu, the company said in a statement released today. "At the current time, there is no factual basis for this media report."

According to the newspaper's report, the two companies are in the latter stage of negotiations over the deal and hope to reach agreement before the end of this year. The proposed deal would see Fujitsu sell its entire hard-disk drive unit, including plants in Japan, the Philippines and Thailand.

Fujitsu competes in hard drives with bigger rivals Seagate Technology Western Digital and Hitachi Ltd. If talks with Western Digital succeed, the deal would expand Western Digital's presence in laptop hard drives in its bid to catch up to No.1 Seagate.

A combined Fujitsu and Western Digital would have had a 29.6 percent market share, still in second place behind leader Seagate, which enjoyed a 35 percent share, but further ahead of third-ranked Hitachi.