Another story on the HP printer plant purchase
May 18, 1998, TechWeb News
Jabil joins buying blitz
By Darrell Dunn
Jabil Circuit Inc., which in the past has declined to partake
in the acquisition frenzy that's swept the contract
electronics manufacturing industry, last week signed an
agreement to purchase two printed-circuit-board
operations from Hewlett-Packard Co.
As part of the agreement, financial terms of which were
not disclosed, Jabil will assume manufacturing
responsibility for all formatter-card production related to
HP's LaserJet product line, which analysts believe could
result in as much as $500 million in annual revenue. The
transaction is expected to close Aug. 31.
Jabil will acquire the printed-circuit-board assembly
assets of HP's LaserJet Solutions Group Formatter
Manufacturing Organization. Included are a 70,000-sq.-ft.
plant in Boise, Idaho, and a 40,000-sq.-ft. plant in
Bergamo, Italy. Jabil, a contract electronics manufacturer
based in St. Petersburg, Fla., is expected to offer jobs to
those plants' 600 employees.
Without making an acquisition, Jabil has quickly become
the world's fourth-largest CEM. The company's revenue
grew to $978 million in fiscal 1997 from $173 million in
fiscal 1992. Through the first half of fiscal 1998, the
company has reported revenue of $651 million.
"People have gotten a mistaken impression based on our
track record," said Thomas Sansone, Jabil's president.
"We've not been against acquisition. ... It's just that we
have an approach to the business that doesn't necessarily
work with every factory we see."
The addition of as much as $500 million in new business
from HP could push Jabil near the $2 billion mark in
annual revenue in 1999.
In 1997, HP shipped more than 2.2 million laser printers
and held a commanding 70% share of the laser-printer
market, according to Dataquest Inc., San Jose.
The acquisition will also provide Jabil with new
geographic bases. In addition to its headquarters, Jabil
currently has plants in San Jose; Auburn Hills, Mich.;
Guadalajara, Mexico; Livingston, Scotland; and Penang,
Malaysia.
Copyright (c) 1998 CMP Media Inc.
Regards
Neil |
