Flextronics to Buy Rival Electronics Assembler DII

Flextronics International Ltd., which makes and assembles circuit boards and cell phones for other companies, agreed to buy rival DII Group Inc. for about $2.4 billion in stock to boost production and add customers. San Jose-based Flextronics will swap 0.805 share for each share of DII Group, valuing each DII share at $65.41, 26% more than Friday’s close. Flextronics will get DII’s 12,000 employees and 22 plants worldwide, making it the world’s No. 4 assembler of circuit boards, cell phones and computers. DII, which is based in Niwot, Colo., and Flextronics put together computer, electronic and telecommunications equipment for larger companies that want to contract out manufacturing to cut costs. Upon completion of Flextronics’ purchase of DII Group, expected in early April, DII shareholders will own about 34% of the combined company. A 2-for-1 stock split of Flextronics shares is expected to take place before then. In Nasdaq trading, DII Group rose $8.88 to close at $60.69, while Flextronics fell $1.69 to close at $79.56.