Avnet is buying Memec for approximately $676m in a stock and cash transaction, including the assumption of around $194m of Memec's net debt.
Memec, a leading global distributor specialising in semiconductors, generated approximately $2,3 bn revenue in 2004. In the same period it generated operating income of $63m. The privately-held company, which employs 2400 people, provides customers with engineering expertise and design services covering a portfolio of semiconductor devices from industry leading suppliers.
Memec will be integrated into Avnet and its Electronics Marketing Group. After the acquisition, Avnet's Electronics Marketing Group will have operations in 69 countries and anticipated annual sales of over $8,5 bn, according to the company.
Commented Avnet's chairman and CEO, Roy Vallee, "We are excited about the opportunity to significantly expand our presence in each of our existing three regions as well as gain entry into the important Japan market. Memec is a well-established semiconductor distributor with valuable franchises, strong technical capabilities and many talented people. In addition to delivering more value to both companies' customers and suppliers, the combination creates significant value for Avnet shareholders."
Memec, with operations in 33 countries and 130 cities, is the largest semiconductor distributor focused primarily on design chain services. In calendar year 2004, Memec grew total revenue approximately 27%, with the Americas accounting for 44% of Memec's 2004 revenue followed by the Asia region, including Japan, at 31% and Europe, Middle East and Africa at 25%.
Said David Ashworth, Memec's president and CEO, "Given the increased demands of global technology markets, we have been exploring a number of strategic alternatives and combining with Avnet provides the best future for Memec."
"The acquisition of Memec strongly enhances our global design chain capabilities while reinforcing our critical role in supply chain services," stated Harley Feldberg, president of Avnet Electronics Marketing. "With an expanded franchised supplier line-card, coupled with a portfolio of world-class design chain and supply-chain services, we are confident that we will further strengthen our relationships with customers and suppliers."
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