Jabil Circuits (JBL)

[EZ2]

Thursday April 25, 6:18 am Eastern Time
EU Oks Jabil Acquisition Of Alcatel Manufacturing Unit

BRUSSELS -(Dow Jones)- The European Union Commission Thursday approved Jabil Circuit Inc.'s (JBL) acquisition of Alcatel (NYSE: ALA - news) SA's (ALA) telephone-exchange plant in Brest, France .

Financial terms weren't disclosed.

The deal is part of the French telecom giant's strategy to outsource much of its manufacturing and focus on its core operations - research and development, and marketing and sales.

"It became critical for Alcatel to find a partner that contributes manufacturing and purchasing power," said Olivier Houssin, president of Alcatel 's e-Business Group. "This outsourcing agreement is the best option for the development of the factory."

The purchase includes a three-year renewable agreement under which Jabil will take over the factory in Brest and its 700 employees, as well as supply Alcatel with Private Branch Exchanges, or PBX, and Private Communication Exchanges, or PCX, units.

A PBX is a telephone system that switches calls between users on local lines while allowing all users to share a certain number of external telephone lines. The PCX does the same, but also provides Internet access.

In July 2001 , Alcatel completed the outsourcing of its cell telephone factory to Singapore -based Flextronics International Ltd. (FLEX). Last month, it received E.U. approval to sell three of its plants to U.S. electronics giant Sanmina-SCI Corp. (SANM).

Jabil Circuit makes circuit boards and systems for electronic products. It operates 22 manufacturing facilities in 12 countries. Jabil had a fiscal 2001 revenue of $4.3 billion and net profit of $144 million.

The deal was approved under the Commission's simplified antitrust procedure. This clears mergers or acquisitions after one month if no objections are raised by third parties.



(This story was originally published by Dow Jones Newswires)
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