TYCO INTERNATIONAL AGREES TO ACQUIRE THOMAS & BETTS ELECTRONIC OEM BUSINESS
This is of relevance to Valence due to the initiation of a relationship between Valence and TDI (owner of HET, who are now out of the lithium-polymer cell-making business), as related by Lev Dawson on the most recent Valence conference call. Recall that TDI was a privately-held, well-respected battery repackager prior to their acquisition by Thomas and Betts (TNB). Now it appears that TNB is selling ALL their electronic OEM business divisions to TYCO, a company which is growing quickly through acquisition.
The relevant text extract is: " The Mobile Communications group is the largest non-captive assembler of cellular phone battery packs, battery connectors and unique elastometric connection devices. "
Clearly, TDI will still be assembling cells, and it is a reasonable speculation that if they incorporate lithium-polymer cells into the product line they sell to customers, Valence would be the provider.
I like the idea of having multiple repackagers in play. To-date Valence can count at least three: Moltech, the Korean repackager (mentioned on the conf call as the one selling to the French consortium, presumably including Alcatel; see the specs on the Alcatel 700 phone using a lithium-polymer cell with specs as advertised on the Valence website), and Micro-Power (the Portland, Oregon -based repackager mentioned on the conference call). TYCO/TDI would be the fourth, which the PR states is the 'largest non-captive assembler.'
Now let's see how it goes...
Enjoy!
Rich
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investors.tycoint.com
TYCO INTERNATIONAL AGREES TO ACQUIRE THOMAS & BETTS ELECTRONIC OEM BUSINESS
Acquisition Provides Excellent Strategic Fit, Will be Immediately Accretive to Earnings
Pembroke, Bermuda, May 7, 2000 - Tyco International Ltd. (NYSE: TYC, LSE: TYI, BSX: TYC), a diversified manufacturing and service company, announced today that it has agreed to acquire the Electronic OEM Business of Thomas & Betts (NYSE: TNB) for $750 million in cash. This agreement is subject to regulatory approval.
The Electronic OEM Business of Thomas & Betts manufactures electronic connectors for the telecommunications, computer and automotive industries. During 1999, this business unit had revenues of $687 million.
"This business is an excellent fit with Tyco Electronics," according to L. Dennis Kozlowski, Chairman and Chief Executive Officer of Tyco International. "It will increase the breadth of Tyco's product line. The high quality brand name products that will be acquired are extremely complementary to those of Tyco Electronics and will allow us to leverage our existing customer relationships and product offerings. Tyco Electronics will also gain access to state-of-the-art products, including the Metallized Particle Interconnect System, a patented high performance connector," Mr. Kozlowski continued.
"This acquisition offers significant cost saving opportunities through manufacturing synergies, rationalization of R&D and efficiencies through combined product marketing, distribution and purchasing," Mr. Kozlowski stated. Mr. Kozlowski also noted that the addition of this business would provide an immediate positive contribution to Tyco's earnings.
"Our previous acquisitions in Tyco Electronics have achieved strong top line growth and exceeded cost reduction targets. We expect that the acquisition of the Electronic OEM Business of Thomas & Betts will also provide positive benefits to Tyco shareholders," Mr. Kozlowski concluded.
The Electronic OEM Business includes the following product categories: The Metallized Particle Interconnect group offers a patented low cost, solderless, flexible, high performance, high density material interconnect system that is utilized in thermal management, backplane systems and laptop computers. The General Professional Electronics group supplies PCB mounted electromechanical components, including switches, sockets and I/O connectors. The Automotive group manufactures a variety of connectors for safety systems, I/O devices, wire harnesses, power distribution centers and other products. The Mobile Communications group is the largest non-captive assembler of cellular phone battery packs, battery connectors and unique elastometric connection devices.
The brand names being acquired include Augat sockets, Alco switches, Ansley/Holmbert I/O connectors, RDI/Buchanan terminal blocks and the Flexstrip product line, among others.
ABOUT TYCO ELECTRONICS
Tyco Electronics Corporation is one of the major business units of Tyco International Ltd. (NYSE: TYC; LSE: TYI; BSX: TYC). Tyco Electronics is the world's leader in electrical, electronic and fiber-optic connectors and interconnection components and systems. It has facilities located in over 50 countries serving customers in the automotive, computer, communications, consumer electronics, industrial and power industries. With its headquarters in Harrisburg, Pennsylvania, USA, it is the largest passive electronics components supplier in the world, providing advanced technology products from its AMP, Elcon, Elo Touchsystems, HTS, M/A-COM, Madison Cable, OEG, Potter & Brumfield, Raychem, Schrack and Simel brands.
ABOUT TYCO INTERNATIONAL
Tyco International Ltd., a diversified manufacturing and service company, is the world's largest manufacturer and servicer of electrical and electronic components and undersea telecommunications systems. It is the world's largest manufacturer, installer, and provider of fire protection systems and electronic security services and the largest manufacturer of flow control valves. Tyco has strong leadership positions in disposable medical products, plastics, and adhesives. The Company operates in more than 80 countries around the world and has expected fiscal 2000 revenues in excess of $28 billion.
FORWARD LOOKING INFORMATION
Comments in this release concerning market growth, expected benefits from the Thomas & Betts acquisition, earnings impact from the Thomas & Betts acquisition, and expected fiscal 2000 revenues are forward-looking statements, which are based on management's good faith expectations and belief concerning future developments. Actual results may materially differ from these expectations as a result of many factors, relevant examples of which are set forth in the "Management Discussion and Analysis" section of Tyco's 1999 Annual Report to Shareholders, and Tyco's 1999 Annual Report on Form 10-K. |
