Solectron Agrees to Acquire Smart Modular

Solectron Corp. said it agreed to acquire memory-chip maker Smart Modular Technologies Inc. for about $2 billion in stock. Solectron, the No. 1 manufacturing-services company for the computer and electronics industries, will exchange 0.51 of its shares for each share of Fremont, Calif.-based Smart Modular. That values Smart Modular at $37.61 a share. Smart Modular gained 81 cents to $24.31 on Nasdaq before activity in the stock was halted. The acquisition was unveiled at the close of trading in New York. Milpitas, Calif.-based Solectron said the purchase will boost fiscal 2000 earnings by 9 cents a share before charges.

Separately, Solectron said fiscal fourth-quarter net income rose 59% to $88.8 million, or 33 cents a share, from $55.9 million, or 23 cents, a year earlier. Revenue in the quarter ended Aug. 27 increased 41% to $2.39 billion from $1.69 billion. Solectron fell $3.75 to $73.75 on the New York Stock Exchange.