This story is taken from Business at sacbee.com.

IDW sold for $300 million

Singapore tech firm buys the Roseville company with stock.

By Dale Kasler -- Bee Staff Writer
Published 12:01 am PDT Wednesday, September 6, 2006

IDW said Tuesday that it has accepted a $300 million buyout offer from Flextronics International Ltd., an electronics manufacturer based in Singapore. It's an all-stock transaction; the takeover price could change as Flextronics' stock price fluctuates. The deal is set to close later this year.

IDW has been sort of an oddity on the Sacramento region's technology scene, a significant global company with almost no local presence. The 6-year-old company employs more than 3,500 workers but only 10 in Roseville. Its factories are in China.

At the same time, it's another example of a small tech company that's put down Sacramento-area roots, said Barbara Hayes of the Sacramento Area Commerce and Trade Organization.

Companies like IDW "kind of fly below the radar screen, but these are important pieces of our economy," said Hayes, who is SACTO's executive director.

The news came a week after another local tech company, Roseville computer-chip designer Sierra Logic Inc., agreed to be sold to Emulex Corp. of Costa Mesa for $180 million.

IDW's Roseville headquarters will remain intact as IDW becomes a subsidiary of Flextronics, said IDW Chairman and Chief Executive Tom Lacey.

"Business as usual -- no impact," he said.

IDW makes liquid crystal display screens for small electronics products such as MP3 players, cell phones and printers. In the first six months of its current fiscal year, it earned $2.6 million on sales of $50.8 million.

Lacey said Flextronics is one of IDW's top customers, accounting for about 15 percent of sales. The companies have been discussing a buyout since early August.

He said the deal makes sense because it will create a stronger company. Flextronics has operations in 30 countries and earned $141.2 million on sales of $15.29 billion in its latest fiscal year.

The deal calls for IDW shareholders to receive $6.55 worth of Flextronics stock for every IDW share. The price could change as Flextronics' share price fluctuates, and IDW could cancel the deal if the price falls 15 percent or more.

IDW shares closed at $6.21 a share, up 26 cents, on the Nasdaq market. Flextronics closed at $11.72, down 5 cents, also on the Nasdaq.

About the writer:

• The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.com.

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