Samsung said on Friday it had agreed with Hitachi's data storage business unit to a license deal over hard disk drive (HDD) patents. Samsung, the world's largest maker of memory chips, said in a filing with the Korea Exchange that the agreement with Hitachi Global Storage Technologies Inc covers HDD patents by IBM and Hitachi.

Hitachi acquired IBM's HDD business in January 2003 and then integrated the business with its own HDD operations to establish Hitachi Global Storage. The acquisition cost Hitachi $2 billion.

Along with the agreement, Samsung and Hitachi would drop patent suits they have filed against each other, Samsung said. Hitachi had sued Samsung in December 2006 and Samsung filed a countersuit in March 2007.

Hitachi also today denied the reports that the company was in talks with Sliver Lake Partners to accept investments for its U.S. hard disk drive unit.

"Hitachi is focusing on improving the performance of the Hard Disk Drive business, exploring every possibility. However the fact is that Hitachi has not decided to sell the Hard Disk Drive business," Hitachi said in a statement.

According to the recent reports, Silver Lake was considering to snap up a stake of slightly less than 50 pct in Hitachi Global Storage.

Hitachi's U.S hard disk subsidiary has been bleeding red ink due to tough competition in the HDD market and falling prices.