News
CHANDLER, Ariz., Nov. 8 — Microchip Technology, a provider of microcontroller and analog semiconductors, will in January convert its product packaging to lead-free plating, to comply with pending government regulations.
The company has selected matte tin as its plating material. The finish makes the company's products compatible with tin-lead soldering processes and higher-temperature lead-free processes.
The company has been shipping parts with matte tin plating in volume for over a year, Microchip said.
A number of semiconductor suppliers have announced plans to convert their line cards by the end of the first quarter 2005. See the story in the December issue of Circuits Assembly, coming soon.
CTS will pay between $14.20 and $15 per share, 75% in cash and 25% in CTS common stock, for SMTEK. CTS will also assume about $15 million in outstanding debt of SMTEK. Shares of SMTEK closed yesterday at $2.41 and the company's 52-week high is $7.50.
The acquisition is subject to shareholder approval and is expected to close in the first quarter 2005.
Upon completion of the deal, SMTEK will merge with CTS' EMS business unit, Interconnect Systems. The combination is expected to significantly expand the operational footprint, customer base, and capabilities of both businesses in the EMS market. The companies had combined revenues of about $625 million over the past 12 months.
In a press statement SMTEK chairman James Burgess said, "This acquisition ... recognizes [SMTEK's] achievement in emerging as a successful, effectively managed business with a strong competitive presence in the EMS industry. We feel the result will be significant business and financial benefits for both companies."
Elkhart, IN based CTS had revenues of $521 million over the past 12 months. SMTEK had sales of $102.4 million and operating earnings of $4 million
The companies will hold a conference call today at 1:30 p.m. Eastern: 800-762-6067 (480-629-9566, if calling from outside the U.S.). No access code is needed.
In a research report released today, Deutsche Bank said, "We have become more optimistic about Sanmina`s longer-term strategy, but believe the company must clear several near- and long-term hurdles before it warrants a premium valuation to its peers. Most importantly, we believe Sanmina`s short-term margin targets will prove aggressive."
Sanmina-SCI has set a goal of 10% revenue growth for fiscal 2005, a target DB calls "achievable." The investment bank "continues to question" Sanmina-SCI's margin forecasts, however, saying "management`s forecasts for its components business are particularly aggressive."
Sanmina-SCI cut its revenue estimates from original design manufacturing (ODM) services to $150 million to $200 million next year. Last year, the company forecast ODM sales would be $500 million by 2005.
Press Releases
- Luminovo Partners with Sluicebox to Offer an Industry-First Instant Product Carbon Footprint for Electronics
- The Assembly Show and SMTAI Announce Colocation in October
- SIA Applauds CHIPS Act Incentives for GlobalWafers Projects in Texas and Missouri
- ROCKA Solutions Continues Expansion in Brazil with New Location in Manaus