Newport Corp. to Sell Metrology Business

IRVINE, Calif., April 12 -- Newport Corp. has announced its intent to sell the majority of its Industrial Metrology Systems Div. in two transactions with unrelated strategic buyers. In the first transaction, Newport signed an agreement yesterday to sell the contact measurement piece of its metrology business, primarily related to its CEJohansson subsidiary in Sweden, to Hexagon AB, based in Nacka Strand, Sweden. Hexagon is a multinational engineering company and parent of metrology company Brown and Sharpe, headquartered in North Kingstown, R.I.

Newport also announced it is in negotiations to sell its US-based noncontact metrology business to a separate strategic buyer.

The total cash proceeds from both transactions are expected to be in the range of $10 to $12 million, and Newport said it expects to finalize both transactions in the second quarter of this year. The transactions are expected to be immediately accretive to Newport's operating results, because the sales will eliminate continuing losses in its metrology business. In addition, the transactions will allow Newport to focus its resources on the strategic parts of its business, the company said.

Newport's combined metrology operations to be divested generated sales of approximately $24 million in 2001 and incurred operating losses of approximately $9 million. The business represented approximately $32 million of Newport's total assets of $544 million as of Dec. 31, 2001. Newport will discuss the expected impact of the sale on its projected future financial results in connection with its first quarter earnings announcement on April 23.