by CIO Staff

Jabil to Buy Taiwan Mobile-Phone-Component Maker

Nov 27, 20062 mins
MobileSmall and Medium Business

Jabil Circuit, a U.S. electronics maker, plans to buy a Taiwanese maker of mobile phone parts for as much as US$900 million, as electronics manufacturing companies continue to expand.

Jabil agreed to pay New Taiwanese $109 (US$3.31) cash per share to acquire 100 percent of Taiwan Green Point Enterprises, which owns nine manufacturing plants in Asia, including seven in China and one each in Taiwan and Malaysia, the company said in a statement.

The deal will enhance Jabil’s ability to design and manufacture mobile consumer electronics products, it said.

Taiwan Green Point said the combination will increase the business scope of the companies, drive down costs and increase market share, in a statement to the Taiwan Stock Exchange.

The world’s largest electronic manufacturing services (EMS) companies have been buying other companies to increase their size and scope of offerings in recent years, which helps lower production costs and results in cheaper gadgets for users. Hon Hai Precision Industry, the world’s largest EMS company, is already a leading mobile digital device maker, assembling handsets for giants such as Nokia as well as iPods and, reportedly, iPhones, for Apple Computer. The company recently closed a US$930 million deal to buy a Taiwanese digital camera maker.

Jabil plans to launch a tender offer for Taiwan Green Point shares on Thursday and will close the deal only if it gains a majority of the company’s outstanding shares. In addition, the deal is subject to regulatory approval in Taiwan and China, as well as a vote by Taiwan Green Point shareholders. The offer to buy shares will run for 50 days.

The 30,000 workers, including management, at Taiwan Green Point will remain on board following the deal, Jabil said. The Taiwanese company will also retain its name and operate as an independent business under Jabil.

-Dan Nystedt, IDG News Service (Taipei Bureau)

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