Bermuda-based Tyco International plans to close 16 of its electronics manufacturing factories in North American and Europe and may even spin off some businesses. The conglomerate will take a restructuring charge of up to $175 million, $60 million in fiscal 2006.

 

Earlier this year, Tyco reportedly said it would seek a buyer for at least some of its PCB fabrication plants, a Wall Street analyst told Circuits Assembly.

Last Wednesday, chief executive Edward Breen told analysts during the company’s quarterly conference call that Tyco would close 16 factories within the next two years to improve profits in its electronics businesses. The company did not specify where and when the closures would occur.

On the call, Breen said Tyco was exploring a range of options to boost its stock, including splitting up the company. The company also said it would raise prices to offset higher raw material costs.

Electronics made up $12.2 billion, or 29.4%, of Tyco's $41.5 billion in sales in fiscal 2005. Its PCB business makes up some 4% of the Electronics division's sales, Tyco told reporters at Productronica last week. (Four percent would equal a range of $427 million to $548 million.)

Tyco is the largest supplier of PCBs to the U.S. military.

Deutsche Bank in a research note speculated that Tyco would close up to 25% of its capacity in Europe.

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