Celestica acquires IBM facilities

By Staff -- Purchasing, 2/10/2000

Celestica, a leading contract manufacturer, says it will expand its business with IBM's Enterprise Systems Group and Microelectronics Division by acquiring IBM facilities in Rochester, Minn., and Vimercate and Santa Palomba, Italy.

The agreements, valued at approximately $500 million, include the license of intellectual property rights and transfer of assets relating to the Enterprise Systems Group and Microelectronics Division manufacturing operations. At the same time, strategic supply agreements with annualized revenues of approximately US $1.5 billion were entered into between Celestica and IBM.

Under the terms of the agreements, Celestica will provide IBM with a complete range of electronics manufacturing services, including comprehensive supply chain management services, early prototyping, new product introduction, printed circuit board assembly and test, system assembly and test, fulfillment and end-of-life support.

The 120,000 square foot Rochester operation provides printed circuit board assembly and test services. The combined Italian operations provide printed circuit board assembly and system assembly services, and span about 1 million square feet. As part of this transaction, approximately 1,800 employees from IBM's Enterprise Systems Group and Microelectronics Division will join Celestica.

"This further enhances Celestica's long-standing relationship with IBM, allowing Celestica to provide a truly comprehensive and cost-competitive global EMS solution to IBM's Enterprise Systems Group and Microelectronics Division," says Eugene Polistuk, president and CEO, Celestica. "This transaction also reinforces Celestica's commitment to maintaining its technology leadership through the enhancement of its intellectual capital base with the addition of a skilled work force and talented management team capable of contributing to the future growth of Celestica," he says.

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