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Electronics Production | September 05, 2006

Flextronics to acquire IDW

Flextronics and International DisplayWorks announced the two companies have entered into a definitive agreement for Flextronics to acquire IDW
Under the terms of the agreement, Flextronics will acquire IDW in a stock- for-stock merger with an aggregate value of approximately $300 million.

The exchange ratio used at closing will be calculated using the Flextronics average daily closing share price for the 20 trading days ending on the fifth trading day immediately preceding the closing.

The exchange ratio will be fixed inside a 10% and 15% collar resulting in a floating purchase price if the average Flextronics' stock price increases or decreases between 10% and 15% from $11.73 per share. IDW has the right to terminate the agreement if Flextronics' average share price falls 15% or more below $11.73, subject to a Flextronics top-up right. If Flextronics' average share price increases to 15% or more above $11.73, the exchange ratio will float based on a fixed purchase price of $6.85 per share.

The transaction is subject to customary closing conditions, including IDW stockholder approval and certain regulatory approvals. The acquisition is expected to close in the fourth calendar quarter of 2006. As a result of the acquisition, IDW will become a wholly-owned subsidiary of Flextronics.
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