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Flextronics to Acquire LCD Maker IDW

Photonics.com
Sep 2006
SINGAPORE and ROSEVILLE, Calif., Sept. 5, 2006 -- Electronics manufacturing services provider Flextronics International Ltd. of Singapore will acquire Roseville-based LCD maker International DisplayWorks Inc. (IDW) in a stock-for-stock merger valued at approximately $300 million, the two companies announced today.

The acquisition will result in a company which specializes in the manufacture of high-quality small form factor LCDs, modules and assemblies for a variety of applications, including cell phones, MP3 players, industrial and commercial products, and eventually digital cameras, the companies said.

Flextronics CEO Mike McNamara said, "IDW is an important and strategic addition to Flextronics' product offerings and capabilities. IDW augments our strategy of providing vertically integrated solutions by adding LCD design and manufacturing capabilities. We expect this transaction to be neutral to our diluted EPS expectations in the first 12 months and expect it to be accretive thereafter."

Following completion of the acquisition, Flextronics said it will combine IDW's LCD operations with Flextronics' Camera Module Group, TV tuner and Wi-Fi and TFT module assembly operations to create a new business unit within its Components Div. Flextronics said it will have 8000 employees across six business unit factories and will transition its LCD sourcing to IDW wherever possible.

The stock exchange ratio will be based on Flextronics' average daily closing share price for the 20 trading days ending on the fifth trading day immediately preceding the closing. The exchange ratio will float inside a 10 percent collar, and will be calculated using a fixed purchase price of $6.55 per share for each share of IDW common stock. IDW has the right to terminate the agreement if Flextronics' average share price falls 15 percent or more below $11.73, subject to a Flextronics top-up right. If Flextronics' average share price increases to 15 percent or more above $11.73, the exchange ratio will float based on a fixed purchase price of $6.85 per share.

The transaction is subject to customary closing conditions, including IDW stockholder and regulatory approvals. It is expected to close in the fourth quarter of 2006, at which time IDW will become a wholly-owned subsidiary of Flextronics.

For more information, visit: www.flextronics.com


GLOSSARY
camera
A light-tight box that receives light from an object or scene and focuses it to form an image on a light-sensitive material or a detector. The camera generally contains a lens of variable aperture and a shutter of variable speed to precisely control the exposure. In an electronic imaging system, the camera does not use chemical means to store the image, but takes advantage of the sensitivity of various detectors to different bands of the electromagnetic spectrum. These sensors are transducers...
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