Flextronics International and the Dii Group sign merger agreement

Citation

(2000), "Flextronics International and the Dii Group sign merger agreement", Soldering & Surface Mount Technology, Vol. 12 No. 1. https://doi.org/10.1108/ssmt.2000.21912aab.043

Flextronics International and the Dii Group sign merger agreement

Flextronics International and the Dii Group sign merger agreement

Keywords: Flextronics, The Dii Group, Mergers and acquistions

Flextronics International Ltd and The Dii Group, Inc. have announced the signing of a definitive merger agreement for a tax-free, stock-for-stock merger. The combination enables Flextronics to expand its printed circuit board operations and design services, while providing additional geographic locations and customer relationships. For The Dii Group this merger enables its stockholders to participate in the expanded growth that top tier electronics manufacturing service providers are experiencing. Based on Flextronics' closing price of $81.25 on 19 November 1999, the transaction is valued at approximately $65.41 per share of Dii common stock, or more than $2.4 billion in the aggregate. As a result, this transaction is the largest combination in the electronics manufacturing services industry. In addition, on 20 November 1999, the board of directors of Flextronics approved a two-for-one stock split, which will be completed prior to the closing of the merger.

Under the agreement, Dii shareholders will receive 0.805 Flextronics ordinary shares for each share of the Dii Group (1.61 Flextronics ordinary shares after giving effect to Flextronics' planned two-for-one stock split), resulting in current Dii shareholders owning approximately 34 percent of the combined company. The merger is intended as a pooling of interests, and is subject to approval by shareholders of both companies, regulatory approvals and other customary conditions. Executives and directors of both companies have agreed to vote their shares in favor of the proposed transaction. The companies anticipate that the transaction will be completed in early April 2000.

The combined company will operate under the Flextronics International name. The companies on a combined basis had sales for the last 12 months of over $3.8 billion.