Feeds

Giant PC outsourcer throws in the towel

Sanmina-SCI sells business to Foxconn and Lenovo

7 Elements of Radically Simple OS Migration

Sanmina-SCI, the US electronics contract manufacturing company, has sold its PC business to Foxconn, a major Taiwanese competitor, for between $80m-$90m. It is also selling its Mexican PC plant to Lenovo, for an undisclosed sum.

Foxconn will get its mitts on factories in the US, Mexico and Hungary, but we must wait for Sanmina-SCI's Q2 earnings call in April for further details. The deal is expected to close by June 28.

Considering that PC manufacturing accounted for $3bn or so of Sanmina's $10.3bn revenues in 2007, the price that Foxconn is paying shows how terrible margins are in this business, and how keen Sanmina is to get the hell out of there. Sanmina-SCI says the two deals should result in a $200m benefit - as it has "significantly reduced the net assets" in the business since last year, when it first announced its intention to flee PCs.

Sanmina-SCI also builds computer servers for clients. But a company that is capable of junking a $3bn revenue line because it is "no longer integral" is capable of junking anything.

IBM, HP and Lenovo are the company's three biggest customers, accounting for more than 10 per cent of current revenues, Sanmina-SCI noted in a recent 10-k filing.

Press release here. ®

Build a business case: developing custom apps

More from The Register

next story
Nice computers don’t need to go to the toilet, says Barclays
Bad computers might ask if you are Sarah Connor
4K video on terrestrial TV? Not if the WRC shares frequencies to mobiles
Have your say with Ofcom now, before Freeview becomes Feeview
PEAK LANDFILL: Why tablet gloom is good news for Windows users
Sinofsky's hybrid strategy looks dafter than ever
YES, iPhones ARE getting slower with each new release of iOS
Old hardware doesn't get any faster with new software
You didn't get the MeMO? Asus Pad 7 Android tab is ... not bad
Really, er, stands out among cheapie 7-inchers
Apple winks at parents: C'mon, get your kid a tweaked Macbook Pro
Cheapest models given new processors, more RAM
VMware builds product executables on 50 Mac Minis
And goes to the Genius Bar for support
Leaked Windows Phone 8.1 Update specs tease details of Nokia's next mobes
New screen sizes, dual SIMs, voice over LTE, and more
Microsoft stands on shore as tablet-laden boat sails away
Brit buyers still not falling for Windows' charms
prev story

Whitepapers

7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Solving today's distributed Big Data backup challenges
Enable IT efficiency and allow a firm to access and reuse corporate information for competitive advantage, ultimately changing business outcomes.
A new approach to endpoint data protection
What is the best way to ensure comprehensive visibility, management, and control of information on both company-owned and employee-owned devices?