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Elcoteq Acquires Philips' Flat Panel TV Ops in Mexico |
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Written by Mike Buetow
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Friday, 05 September 2008 |
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ESPOO, FINLAND – Elcoteq SE has closed on a deal to purchase Philips' flat panel TV assembly operations in Juarez, Mexico. Under terms of the deal, Elcoteq will pay $32 million in cash for certain fixed assets and inventories. The 740 local Philips personnel will become employees of Elcoteq.
The deal includes a long-term supply deal to provide manufacturing services to Philips for its Latin American FTV business and its Business Services unit in the Americas, and a long-term agreement to provide manufacturing services to Funai Electric FTV business in North America.
Elcoteq expects the net sales, estimated to be $200 million in 2008 and $250 million in subsequent years (excluding LCD panels), to be accretive in 2008.
The EMS company will lease the required manufacturing space of approximately 20,000 sq. meters.
"This deal marks our entrance into complete final assembly of FTVs – a strategic product segment for us where we so far have provided printed circuit board assemblies and various subassemblies to our customers," said Vesa Keränen, president of Elcoteq Home Communications, in a press release.
"We have a 12-year cooperation relationship with Elcoteq and are confident it is an excellent partner when we continue streamlining our global supply chain for FTV products," said Rob de Ridder, senior vice president at Philips. "Our move to transfer the Juarez operation to an experienced and leading EMS company in this field was a logical step in optimizing our supply base in the FTV business."
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