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IRVINE, CA – Acer Inc. today announced the purchase of Gateway Inc. for $710 million. The deal has the support of both companies’ boards and is expected to close by December.

WASHINGTON – Factories saw orders for big-ticket goods jump 5.9% in July, the most in 10 months, an encouraging sign that many manufacturers are holding up to the stresses caused by a housing slump and a credit crunch, the Commerce Dept. reported today.

The department reported a sizable increase in new orders for "durable" goods followed a 1.9% rise in June. Durable goods are costly manufactured items expected to last at least three years.

The barometer of manufacturing activity was better than the 1% increase economists expected, and gains were widespread, the report stated. Orders went up for machinery, automobiles, metal products, airplanes and communications equipment. That blunted a drop in demand for computers, as well as electrical equipment and appliances, the reported added.

In the manufacturing report, orders for automobiles rose 9.8% in July, the most since January 2003. Demand for primary metals, including steel, increased 7.9%, the biggest rise since July 2004. Orders for communications equipment soared 20.7%, the most since March 2006. Demand for airplanes for commercial use rose 12.6%. Airplane orders for defense purposes increased 15.8%.

Demand for computers, however, dropped 4% and orders for electrical equipment and appliances fell 1.2%.

Overall, the figures suggest that capital spending by businesses is weathering the financial storm so far, said the Commerce Dept. Credit problems, however, worsened in August, so upcoming reports on manufacturing will offer more insight into companies' spending.

HILLSBORO, OR – Viscom AG, maker of electronics inspection equipment, has acquired the MX family of IR inspection systems from Phoseon Technology Inc., the companies reported today.

The MX product family is a series of semiconductor inspection systems that incorporate infrared light sources for semiconductor applications where inspection through silicon is required, such as MEMS seal inspection, through-silicon wafer bond imaging and inspection, as well as SOI and flip-chip die bond inspection.

The acquisition price will remain confidential. This transaction takes the form of an assets deal and grants Viscom all patents for near IR inspection and exclusive use of Phoseon Near-IR lighting technology for inspection application licenses.

The agreement also transfers employees and the customer and applications base from Phoseon.

FRAMINGHAM, MA – Worldwide semiconductor sales will grow 4.8% this year, before rebounding to 8.1% in 2008, IDC says.

2007 sales are down from 8.8% last year, in part because of inventory and pricing issues. However, IDC expects growth to resume at 8.1% in 2008. An even healthier outcome could be realized, should capacity expansion be tempered next year and growth in demand remain strong, the company says.

Elsewhere, IDC says, market trends point to ongoing mergers and acquisitions that will reshape the landscape and bring traditional suppliers to the forefront.

According to IDC, PC and mobile phone unit volume is steady, led by emerging regions and low-end products; consumer demand is lackluster, but excess inventory has subsided, and design momentum will lead to substantial volume growth during the holiday season.

A severe price correction in the first half leveled the market for memory devices, such as DRAM and NAND. And the microprocessor market remains flat, the firm reports.

IDC’s forecasts emerging regions will boost semiconductor volume growth; multimedia-rich mobile phones continue to drive semiconductor content and demand for processing, memory consumption, and power management; personal computing further migrates toward mobility and low-priced form factors; video processing proliferates across multiple consumer electronic segments, resulting in strong growth for semiconductor suppliers; semiconductor connectivity technologies drive new usage models across device segments, and growth in personal content implies increasing need for storage, including NAND.

In 2006, the top 10 semiconductor vendors accounted for 48% of the worldwide market revenue, says IDC. Intel, Samsung and Texas Instruments held on to the top three positions, with TI showing the highest growth percentage in revenue among the top three. With the exception of Intel, Renesas and NXP, all other vendors in IDC's top 10 ranking showed positive growth. Hynix grew an amazing 43% year-over-year.

SPOKANE VALLEY, WA – EMS provider Key Tronic Corp. reported revenue of $49.2 million for the fourth quarter, up 4% sequentially and down 6% year-over-year.

Net income for the fourth quarter was $2.7 million, which included a benefit from the company's sale of its former facility in Las Cruces, NM, of approximately $1.5 million.

This compares to $7.1 million for the same period last year, which included an income tax benefit of approximately $5 million.

For the year, revenue was $201.7 million, up 7% from last year. Net income was $5.2 million, down 47% year-over-year.

TAIWAN – Taiwanese contract IC foundries are expected to produce $3.66 billion worth of product, up 16.9% sequentially, thanks to growing demand, according to the Taiwan Semiconductor Industry Association.

The sector began recovering in the second quarter, with an output of $3.13 billion, up 13.2% sequentially, according to TSIA.

TSIA predicts third-quarter output will increase 5.5% year-over-year. The trend will follow decreases in inventory brought about by growing demand for PCs, cellphones and other consumer electronics, as a result of positive seasonal sales and outsourcing of orders for nanotech products reported by integrated device manufacturers, the report said.

ENDICOTT, NY — The U.S. Department of Defense has increased an existing contract with Endicott Interconnect Technologies by $19 million to cover additional multichip module assemblies and equipment, the company reports.

EI recently bought a flip-chip packaging line, including a screen printer, placement machines, reflow oven and AOI tools to build the additional MCMs.