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Sanmina-SCI offloads PC biz to Lenovo, Foxconn

Posted: 21 Feb 2008 ?? ?Print Version ?Bookmark and Share

Keywords:personal computing? PC business? EMS?

EMS company Sanmina-SCI Corp. has signed a definitive agreement with Foxteq Holdings Inc., a member of the Foxconn Technology Group, for the sale of certain assets of its PC business and associated logistics services located in Hungary, Mexico and the United States.

Separately, Sanmina-SCI has entered into a non-binding memorandum of understanding with Lenovo Group Ltd to transition responsibility of its Monterrey, Mexico PC operation and to sell certain of its related assets to Lenovo.

The company anticipates that the proceeds from the Foxteq transaction, along with the disposition of certain other related assets associated with, but not included in the Foxteq transaction, will be between $80 and $90 million, depending upon the book value of the assets at the time of closing. Further details will be provided during the company's Q2 fiscal 2008 earnings conference call scheduled in April.

The closing of the Foxteq transaction is subject to customary closing conditions, including regulatory approvals and is expected to close in the company's fiscal Q3 ending June 28.

"This announcement is in line with our previous statements that we would sell or otherwise exit the personal computing business because the business is no longer integral to the company's long-term strategy," stated Jure Sola, chairman and CEO of Sanmina-SCI. "Since we announced our intentions to exit the personal computing business, several operating initiatives have allowed us to significantly reduce the net assets invested in this business. Accordingly, we anticipate that the financial benefits of these initiatives along with the total proceeds from these transactions and other related dispositions to be in excess of $200 million," added Sola.

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