Adaptec to sell assets to Sanmina-SCI

Adaptec Announces Intent to Sign Contract Manufacturing Agreement and Intent to Sell its Singapore Manufacturing Assets to Sanmina-SCI. In connection with this agreement, Adaptec plans to sell certain Singapore manufacturing assets and inventory with respect to printed circuit board assemblies (PCBAs) and storage system manufacturing operations to Sanmina-SCI. "As we continue our analysis of Adaptec businesses and operations, we are identifying areas where associating with strategic partners will allow Adaptec to focus on our core value of delivering advanced RAID data protection technology to our OEM and channel customers worldwide," said S. "Sundi" Sundaresh, president and CEO of Adaptec. "Manufacturing is one of those areas where a partner like Sanmina-SCI can bring additional expertise and efficiencies to the table. As one of the world's top EMS providers, we view Sanmina-SCI as an ideal partner to whom we can entrust our manufacturing needs moving forward." Under the terms of the anticipated contract manufacturing agreement, Sanmina-SCI will assume manufacturing operations of Adaptec products upon closing of the contemplated asset sale between the two companies, estimated to be in early January 2006. As a result of the asset sale transaction, Adaptec expects that it will incur approximately $5 to 6 million in severance costs associated with its work force in its Singapore operations. Additional disclosure regarding the agreements will be provided in a Form 8-K which will be filed with the Securities and Exchange Commission shortly after the agreements are finalized.