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News > Deals
Flextronics buys again
August 10, 2000: 3:37 p.m. ET

Electronics manufacturer pays $640 million for Singapore's JIT Holdings Ltd.
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NEW YORK (CNNfn) - Flextronics International extended its ongoing shopping spree Thursday, paying $640 million in stock for Singapore-based JIT Holdings Ltd. in a deal that significantly expands the company's Far East electronics manufacturing capabilities.

The transaction has significant geographic implications for Flextronics, the world's No. 4 provider of electronics manufacturing services, which is in a race to keep pace with the industry's top players. The acquisition provides the company with a strong foothold in northern China along with some much-needed capacity in Malaysia.

Although based in Singapore, Flextronics (FLEX: Research, Estimates) maintains most its corporate offices in San Jose, Calif., and has seen its customer base shift away from the Far East in recent years.

"Top-tier EMS providers must have the flexibility and speed to expand geographic locations to meet accelerating customer demand," said Michael Marks, Flextronics' chairman and chief executive. "Our merger with JIT enhances our ability to provide an extensive network of manufacturing facilities in northern China, Malaysia and Singapore."

graphicTerms of the transaction call for Flextronics to issue shares valued at approximately $640 million in exchange for all of JIT's outstanding shares. The exact number of Flextronics shares issued is subject to a collar stipulating that the maximum number cannot exceed 9.85 million shares or be less than 7.27 million shares.

Based on the company's closing price of 77-3/8 Wednesday, the company would issue approximately 8.27 shares. Flextronics shares fell 2-1/4 to 75-1/8 in late afternoon trading Thursday.

The deal follows Flextronics' $590 million purchase of Chicago-based Chatham Technologies, a provider of electronics packaging systems, or enclosures, which specializes in the communications industry. The deal was designed to expand the company's focus, which has traditionally concentrated on building "inside the box" circuit board components that help run electronic systems, to encompass manufacturing the entire electronic box.

The deal for JIT is focused more on the company's roots. Currently, more than 80 percent of Flextronics customers are located outside of Asia -- a stronghold of JIT's business.

Founded in 1988, JIT has grown rapidly in recent years and now boasts annual revenues of more than $550 million as well as approximately 4,500 employees in the Far East, including 1,300 in northern China alone, ranking it as the world's 17th-largest electronics manufacturing services provider. Back to top

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