Avnet, Inc. Acquires Source Electronics Corporation
Acquisition Establishes Avnet as the Global Leader in the Programming Services Business
PHOENIX -- Avnet, Inc. (NYSE:AVT) announced today that it has acquired Source Electronics Corporation (Source) headquartered in Hollis, New Hampshire. Established in 1988, Source is a leading provider of outsourced custom programming services for integrated circuits (IC). Source combines deep technical expertise, high quality standards and efficient programming processes to create flexible solutions for a customer base that includes original equipment manufacturers (OEMs), contract manufacturers (EMS) and component manufacturers. From facilities in Brazil, China, Mexico, Singapore and the US, Source supports customers that span a variety of end markets, including consumer electronics, automotive, mobile communications, telecommunications, networking, computing and enterprise storage. Source will be integrated into the services operations of Avnet Logistics, a division of Avnet that delivers logistics and programming services globally.
Source provides high quality programming services using technically advanced proprietary programming processes that result in industry-low defect rates and rapid order fulfillment. With a multi-regional footprint, Source is the only company focused exclusively on programming services and flexible solutions to support the large volume requirements of its global customer base. For the calendar year ended December 31, 2007, Source generated $82 million of revenue. The transaction is accretive to earnings and supports Avnet’s long-term return on capital goals.
Jim Smith, president of Avnet Logistics, commented, “The combination of the extensive programming operations of Source and Avnet Logistics will create an industry leader with global scale and scope advantages. It will also strengthen our competitive position with regard to outsourced service offerings while positioning Avnet Electronics Marketing as the primary global distributor serving the programming needs of the electronics industry. In addition, we will deepen our involvement with many of our suppliers as Source is the programming partner for many IC manufacturers’ direct sales.”
Programmable ICs are an important and rapidly growing technology for systems designers because they increase product flexibility and lower overall system costs. The programmable IC market is forecasted to reach approximately $50 billion in 2011, a unit compound annual growth rate of more than 17%.
Mr. Smith further added, “With the acquisition of Source, we gain significant technical expertise and an experienced management team that has earned an excellent reputation in the programming services market. We also expand Avnet’s presence in the growing South American market through Source’s Brazilian operations located in Sao Paulo and Manaus. Avnet Logistics is well positioned to grow faster than the markets we serve, while delivering superior value to both our customers and suppliers.”
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