Diceon Electronics Buys Phoenix Firm
Diceon Electronics, an Irvine manufacturer of circuit boards, has agreed to acquire Continental Circuits of Phoenix in a stock swap valued at $49 million, Diceon officials said.
According to the terms of the deal, which should be completed in the next two months, Diceon will exchange 3.25 million shares of its stock for all 6.5 million shares of Continental stock, John A. Carr, Continental president and chief executive, said.
Continental is a privately held maker of complex, multilayer circuit boards. The company posted sales of about $66 million and net income of $7.6 million for the fiscal year ended July 31.
Continental officials “are addressing a part of the market we’re not in,” said Peter S. Jonas, Diceon’s executive vice president. “We do not compete against each other; we complement each other. We feel it is a very good strategic alliance.”
Industry analysts said the acquisition, which must still be approved by both companies’ directors, is a good deal for Diceon and a potential insurance policy for Continental.
“Both companies are very well regarded for their ability to do high-density circuit boards,” said Gerald Fleming, an electronics analyst for Bear, Stearns in New York. “Continental has a good position as an IBM supplier and, I think, is one of the leading suppliers of boards for IBM personal-computer products.”
According to Jonas and Carr, no layoffs or plant closures are in the works as a result of the deal.
Once the acquisition is finalized, Jonas said, Continental will operate as an independent, wholly owned subsidiary of Diceon.
