Scitex (SCIX)

[midastouch017]

HP buys Scitex Vision for $230m cash

Scitex estimates that it will recognize a capital gain of $75-95 million.

Globes correspondent 14 Aug 05 10:50

Scitex (Nasdaq: SCIX; TASE: SCIX) announced on Thursday that Hewlett-Packard (HP) (NYSE: HPQ , Nasdaq: HPQ) would buy the assets and business of its majority-owned subsidiary Scitex Vision for $230 million in cash.
Scitex Vision produces wide and super-wide format printers for signage and industrial applications, such as billboards, banners, street advertising and packaging.

Scitex Vision CEO Dov Ofer said, "Joining together Scitex Vision with HP will bring substantial benefits to our customers, the wider marketplace and our employees. Our customers will benefit from access to a wider range of products and services while they continue to enjoy the same high levels of attention that they are used to. Our technology will reach a broader audience as it becomes available more widely. And employees will enjoy professional opportunities as the business grows within a leading global organization."

Scitex currently owns approximately 77.1% of Scitex Vision's share capital (approximately 70.6% on a fully-diluted basis), and each of its principal shareholders, Clal Electronics Industries Ltd. and Discount Investment Corporation Ltd., holds 7.2% of Scitex Vision's share capital (approximately 6.6% on a fully-diluted basis).

Under the terms of the agreement, HP will pay approximately $230 million in cash to Scitex Vision, of which $24 million will be retained in escrow for 24 months to cover possible indemnification claims and an additional $24.5 million will be utilized to repay Scitex Vision's retained liabilities, mainly to Israeli banks.

Closing of the transaction is subject to certain regulatory approvals and other customary closing conditions. The transaction is expected to close within 90 days. Scitex Corporation will license its rights to the "Scitex" tradename to HP. Scitex Corporation has also agreed, subject to shareholder approval, to change its corporate name.

Scitex currently estimates that it will recognize a capital gain in its financial statements of approximately $75-95 million.

Published by Globes [online], Israel business news - www.globes.co.il - on August 14, 2005

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