United Test and Assembly Center Ltd (UTAC) announced today it intends to acquire NS Electronics Bangkok (NSEB), a full turnkey SATS provider based in Thailand, in an all-cash transaction amounting up to US$175 million for a 100% stake. The proposed acquisition will be funded through internal resources and bank borrowings.

Under the Share Purchase Agreement entered into between UTAC and UBS Capital, UTAC will acquire a 68.45% controlling stake of NSEB from UBS Capital. The agreement is conditional upon, amongst others, UTAC successfully acquiring at least another 16.55% of NSEB from the remaining shareholders at the same price per share and on other terms and conditions no less favorable than those agreed with UBS Capital.

NSEB provides a broad portfolio of assembly capabilities to a customers including Texas Instruments (TI), Maxim Integrated Products, Linear Technology and Samsung.

NSEB operates two facilities in the Bangkok vicinity and a sales office in the US, and has a total of 489 wirebonders, 327 testers and 405,000 square feet of floorspace as of the end of 2005. NSEB achieved US$131.1 million in revenues and US$11.9 million in net profits in 2005.

The transaction will enhance UTAC’s assembly business by extending its existing packaging portfolio, providing access to a lower cost structure and enhancing its purchasing power. With minimal overlap in customers, the proposed acquisition will also present greater cross-selling opportunities for the enlarged UTAC Group.

The combination of NSEB’s core competency in packaging technologies with UTAC’s strength in testing allows the enlarged UTAC Group to offer a more comprehensive range of products and services to both UTAC’s and NSEB’s customers.

The proposed acquisition is expected to be completed by June 2006. After the close of the transaction, UTAC will have manufacturing operations in four countries, namely Singapore, China, Taiwan and Thailand.

The enlarged entity will have a combined workforce of 7,500 with 680 testers and 808 wire bonders, with those number being end of 2005 totals.

By: DocMemory
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