© Jabil Electronics Production | February 22, 2011
Jabil buys back operations in Italy & France
Florida-based EMS-provider Jabil Circuit has acquired three of its former operations in France and Italy, which were divested in July of 2010.
Jabil will establish viable operations at the sites following multiple breaches by the purchaser of those facilities, including their diversion of funds that were specifically designated as working capital. “We believe our actions today are in the best interests of the affected customers, former employees, Jabil shareholders, and the well being of the local communities where we operate,” said Tim Main, Jabil’s President & CEO. “Although the transgressions of the purchaser that led to this action were beyond our control, we could not stand-by and allow the circumstances to deteriorate further, risking more serious consequences to our stakeholders.” Pursuant to the agreements, Jabil currently expects, based on existing information, to take a one-time charge of USD 25 - 40 million to U.S. GAAP earnings in its second fiscal quarter of 2011. This charge is principally the write-off of working capital loans for the operations and other expenses associated with the transaction. (Operations in Meung-sur-Loire, France, which were separately and successfully divested on October 27, 2009, are not affected by these actions.) Apart from the aforementioned charges associated with the transaction, the company re-affirmed its guidance for fiscal second quarter of 2011 provided during the quarterly earnings call on December 20, 2010.