Cirtek signs MOU with US-based semiconductor firm

By: Krista Angela M. Montealegre, InterAksyon.com
January 28, 2013 9:08 AM

InterAksyon.com means BUSINESS

MANILA - Cirtek Holdings Philippines Corp expects over $100 million in additional sales in the next five years from two transactions that will ensure the company's long-term growth.

In a statement, the Laguna-based semiconductor maker said it signed a memorandum of understanding with a major US-based company, subject to business and market conditions.

Under the deal, Cirtek will supply the offshore firm's volume requirements for a five year-period until 2017.

"Based on the business forecast given to Cirtek, potential value of the business over five years is estimated at $68 million," the listed firm said.

Cirtek is also inching closer to seal a deal to acquire a Bangkok-based semiconductor assembly and test company that has the potential to generate sales turnover of over $40 million in the next three years if the local firm pours in additional investment in production equipment.

“We are acquiring a company that has an excellent reputation for product quality and better-than-industry cycle time,” Cirtek said.

The acquisition of the Thai firm plays an integral part in Cirtek's expansion program because the former specializes in high-volume and mature packages, complementing the Philippine company’s strength in more intricate, customer-specific packages.

Cirtek will also acquire tier-one customers that will expand its portfolio and establish a presence in Bangkok, a favored hub for semiconductor assembly and test activities.

The two deals will enable Cirtek to achieve its 25 percent sales growth guidance for the year and enable the company to attain "higher levels of sustainable, profitable growth leading to enhanced shareholder value."

"We may adjust our full-year sales and profit guidance when these projects are consolidated into Cirtek’s operations,” the company said.

Cirtek provides turnkey solutions that include package design and development, wafer probing, wafer back grinding, assembly and packaging, final testing of semiconductor devices, and delivery and shipment to its customers.

Last year, Cirtek grew its earnings by 11 percent to $4.4 million from the previous year's $3.96 million after net sales jumped 9 percent to $40.5 million in 2012 compared with $37.1 million in 2011.

InterAksyon.com means BUSINESS