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TDK to take over German electronics parts maker EPCOS (Roundup)
Jul 31, 2008, 9:39 GMT
Tokyo - Japan's TDK Corp plans to purchase German electronics parts maker EPCOS AG for a maximum of 200 billion yen (1.85 billion dollars), which would be one of the largest acquisitions in the industry, media reports said Thursday.
TDK hopes to boost its operations through the deal amidst harsh competition in Asia.
The Japanese company suffered a net profit fall of 72.3 per cent in the April-June quarter from a year earlier to 4.45 billion yen, and its sales were down 7.8 per cent to 190.62 billion yen mainly because of the price cuts and the yen's rise.
TDK is to launch a friendly tender offer for EPCOS shares, which are listed on the Frankfurt Stock Exchange, to make it a subsidiary by the end of this year, Jiji Press quoted informed sources as saying.
After the acquisition, the joint business was expected to become one of the largest companies in the Japanese electronics parts industry, with annual sales projections of more than 1 trillion yen.
The new company, tentatively named TDK EP Components KK, would welcome three executives from TDK and two from EPCOS.
TDK's strengths lie in the production of magnetic heads for hard disk drives as well as in electronics parts for household appliances like cellular phones, while EPCOS' flagship products are components for industrial instruments.
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