Flextronics to acquire 55% of Hughes

NEWDELHI: Singapore-based $14.5 billion electronics manufacturing services (EMS) provider, Flextronics International Asia Pacific Ltd., has signed a definitive agreement with Hughes Network Systems, a wholly-owned subsidiary of DIRECTV, to acquire its entire ownership stake of fifty-five percent in Hughes Software Systems (HSS) at Rs 547 per share.

The $226 million deal is subject to regulatory approval and is expected to close by October 2004. Pursuant to Indian securities regulations, Flextronics is required to make an open offer on or about June 11, 2004 to purchase an additional 20 percent of the shares outstanding from the remaining shareholders at a price not less than Rs 547.

There is no obligation for shareholders to accept this open offer and there is no assurance that any shares will be offered for sale to Flextronics.

The approximate total purchase price of $226 million to be paid to HNS, along with the open offer of $82 million, assuming an offer price of Rs 547, is required to be funded by Flextronics on the date the open offer is initiated.

HNS Mauritius Holdings and HNS Inc., the promoters of HSS executed share purchase agreement with Flextronics earlier today.

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