Through the acquisition of the mobility business, BYDE aims to extend its customer base, diversify its product portfolio, expand the business of smartphone components, enhance its customer and product structure, capitalise on market development opportunities and improve the layout of core component products
Jabil to divest its mobility business to BYD Electronic in $2.2bn deal. (Credit: Pit1233/Wikimedia Commons)
China-based intelligent product solutions provider BYD Electronic (BYDE) has signed an acquisition framework agreement to acquire the mobility business of American manufacturing solutions provider Jabil for nearly $2.2bn.
According to the terms of the preliminary agreement, BYD Electronic will conditionally take full ownership of Juno Newco Target Holdco Singapore from Jabil Circuit (Singapore), a subsidiary of Jabil.
Juno Newco Target Holdco Singapore was established this month, and it will own the business that primarily comprises the product manufacturing business in Chengdu and Wuxi, including the manufacturing of components for existing customers.
Following the closing of the deal, the newly incorporated company will become a fully owned subsidiary of BYDE.
Jabil CEO Kenny Wilson said: “If completed, the proceeds from this transaction will enable us to enhance our shareholder-centric capital framework, including incremental share buybacks.
”Additionally, it will provide opportunities for further investment in electric vehicles, renewable energy, healthcare, AI cloud data centres, and other end-markets.”
According to BYDE, the consideration of the transaction will be subject to a customary completion accounts adjustment mechanism, with pre-closing and post-closing adjustments for cash, indebtedness and net working capital.
Through the acquisition of the mobility business, BYDE aims to extend its customer base, diversify its product portfolio and expand the business of smartphone components.
Besides, the publicly listed company intends to enhance its customer and product structure, capitalise on market development opportunities and improve the layout of core component products.
Both parties have also agreed to pursue a definitive agreement.
The acquisition is subject to due diligence and execution of a definitive agreement and closing of the transaction contingent on regulatory approvals and other customary conditions.