Report: M-Flex in Possible SaleMonday, September 9, 2013
One of Singapore’s oldest companies is looking to sell its majority stake in Anaheim-based Multi-Fineline Electronix Inc., according to a Bloomberg report.
The media company, citing two sources familiar with the matter, reported on Monday that United Engineers Ltd. is looking to sell the printed circuit board maker, which it acquired as part of a $725 million deal for Singapore-based WBL Corp. Ltd. in May.
WBL, a holding company that owns about 62% of M-Flex, has influence over the company’s board, management and operations, according to regulatory filings.
M-Flex, which makes flexible circuit boards used in cell phones, smart phones and other mobile devices, is known to supply components to Apple Inc. and often tracks the Cupertino-based consumer electronics maker on the tech-heavy Nasdaq.
The company did not immediately respond to requests for comment.
Investors welcomed the news, sending M-Flex shares up 3.3% on Monday to a market value of about $390 million.
M-Flex has faced steep sales declines and mounting losses this year as it reduces inventory and production.
Its revenue in the June quarter fell to $136.1 million, down 20% from the same period a year ago. It reported an adjusted loss of $18.5 million, compared to an adjusted profit of $4.3 million a year earlier.
The company projects to regain profitability in the December quarter as it seeks a more diverse customer base, according to Chief Executive Reza Meshgin.
“Our customer relationships are strong, and we are aggressively pursuing new customer and product opportunities to diversify our revenue streams and support our longer-term growth objectives,” he said in the company’s June quarter earnings announcement.
M-Flex cut about 4,000 employees companywide in the past 12 months for a total workforce of about 12,000. The bulk of its workers remain in China.
M-Flex, which sold its 105,000-square-foot headquarters in Anaheim early last year and relocated to the Irvine Spectrum, employs 54 people in Orange County.
United Engineers, established in 1912, owns about 96% of WBL. It posted a profit of $72.1 million on revenue of $595.7 million in 2012.