Flextronics Updates Nortel Deal

SINGAPORE, Oct. 18 -- Flextronics announced today it has updated its agreement to buy certain optical, wireless and enterprise manufacturing operations and optical design operations from Nortel Networks in a transaction expected to generate approximately $2.5 billion for Flextronics, a Singapore electronics manufacturing services provider. (See "Nortel, Flextronics Discuss Divestiture."

The transaction is still expected to be completed in May 2005, the company said. In the initial agreement, two Canadian manufacturing facilities were to be transferred from Nortel to Flextronics in November 2004 and February 2005. Flextronics said those facilities will now be transferred in February and May.

"There has been no significant change to the expected timing of any other operations to be transferred," Flextronics said. "The initial transfer of operations is still expected to occur in November and will comprise the optical design groups in Canada and Northern Ireland."

Flextronics CEO Michael Marks said, "The delay in the transfer of these two manufacturing operations is due to Nortel Networks continuing focus on the completion of its restatement of its financial statements and the required regulatory filings. We are still on track for the targeted completion date of May 2005, so these changes to the schedule are a timing issue, not a deal or relationship issue."

For more information, visit: www.flextronics.com