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Electronics Production | May 25, 2009

Lincoln: Only 6 completed EMS-transactions in 1Q/09

There were only 6 completed EMS-transactions in the 1. quarter of 2009, a sharp drop from the 14 completed transactions recorded for the same quarter a year ago.
The overall economic conditions have heavily affected the M&A (Merger & Aquisition) activity within the EMS-sector. As shown in Chart B, EMS consolidations represented 2 transactions (33% of the total activity). There were two vertical / horizontal convergences in Q1/2009 (33% of the total activity).



The number of EMS-divestitures remained stable with 1 transaction in Q1/2009 (17% of the total activity) and 1 private equity investment (17% of the total activity). There were no OEM-divestitures in the 1. quarter of 2009, Lincoln International states.

Chart C shows that 4 transactions occurred within Europe (representing 67% of the total transactions). There was one cross-border deal (between high and low cost geographies) There was also 1 transaction within U.S./Canada, or 17% of transactions. There were no transactions within Asia for this quarter.

The transactions by size for the quarter were led by the Micro Tier (3 or 50% of all transactions), followed by 1 transaction each in the Small, Mid, and Large Tier. Due to the economic market conditions, larger transactions were more difficult to complete in the past two quarters, the report continues.



Source: Lincoln International
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