DES PLAINES, Illinois, June 21, 2006 – Littelfuse, Inc. (Nasdaq/NMS: LFUS) today announced it has signed a definitive agreement to acquire the assets of Song Long Electronics Co., Ltd., headquartered in Taiwan, for $5.5 million in cash. Song Long manufactures metal oxide varistors at its facility in Dongguan, China. The company has annual sales of approximately $5.5 million, including $2 million of sales to Littelfuse.
“This is an important strategic move for Littelfuse,” said Gordon Hunter, Chief Executive Officer. “Littelfuse’s broad, high-quality varistor product offering is currently hampered by a cost position in Ireland that is not competitive with today’s global market. The Song Long acquisition provides a high-quality, low-cost China manufacturing platform to which we will transfer this product line over the next two years. “
“Song Long has been a supplier partner to Littelfuse for the past five years. Over that period, we have developed a strong working relationship with Song Long’s talented management team and have been impressed with their skilled workforce. Their dedication to quality and customer service will be valuable assets for Littelfuse,” added Hunter.
The downsizing and ultimate closure of the Ireland facility will result in pre-tax restructuring charges of approximately Euros 14.3 million or about $18 million at today’s exchange rate. The cash outflows for this restructuring will occur largely in 2007 and 2008, but in accordance with accounting guidelines, the entire charge of approximately $0.53 per share will be booked in the second quarter of 2006. Cost savings related to the move of the varistor line are expected to begin in 2007 and reach an annual run rate of at least $10 million by the end of 2008.
“This acquisition is another step forward in our strategy to expand our operations in Asia in order to be closer to current and potential customers, ensure a competitive cost position and participate in the growth of the entire region,” said Hunter.
“The decision to move production from Ireland was difficult, especially because of the many employees at this facility who have contributed to our successful growth. However, we believe this step is in the best interest of our company, our customers and our shareholders over the long term,” added Hunter.
Conference Call Webcast Information
Littelfuse management will host a conference call on Thursday, June 22 at 9:00 a.m. Central/10:00 a.m. Eastern time to discuss these announcements. The call will be broadcast live over the Internet and can be accessed through the company’s Web site: www.littelfuse.com. Listeners should go to the Web site at least 15 minutes prior to the call to download and install any necessary audio software. The call will be available for replay through June 30, 2006, and can be accessed through the Web site listed above.
About Littelfuse Founded in 1927, Littelfuse, Inc., the worldwide leader in circuit protection, offers the industry’s broadest and deepest portfolio of circuit protection products and solutions. Littelfuse devices protect products in virtually every market that uses electrical energy, from consumer electronics to automobiles to industrial equipment. In addition to its Chicago, Illinois, world headquarters, Littelfuse has more than 20 sales, distribution, manufacturing and engineering facilities in the Americas, Europe and Asia. Technologies offered by Littelfuse include Fuses; Gas Discharge Tubes (GDTs); Positive Temperature Coefficient Devices (PTCs); Relays, Controls, and Systems; PulseGuard® ESD Suppressors; SIDACtor® Protection Thyristors; TVS Diode Arrays (SPA™ Family of Products); Switching Thyristors; TVS Diodes and Varistors. The company also offers a comprehensive line of highly reliable Electromechanical and Electronic Switch and Control Devices for commercial and specialty vehicles, as well as underground Power Distribution.
For more information, please visit www.littelfuse.com.
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