Fabrinet to Acquire JDS Uniphase Operations in Fuzhou, China

Contract manufacturer looks to grow optical component business; JDS targets lower costs, increased agility

Contract manufacturer looks to grow optical component business; JDS targets lower costs, increased agility

San Francisco, CA — May 2, 2005 — Fabrinet, an engineering and electromechanical manufacturing services company, is set to purchase the JDS Uniphase manufacturing facilities located in Fuzhou, China, acquiring all assets and operations related to the Fuzhou plant, including research and development (R&D) and the manufacture of products such as crystals and precision optics.

Subject to final documentation and customary closing conditions, the transfer to Fabrinet is expected to be completed prior to June 30. Terms of the agreement were not revealed.

The 225,000 square foot Fuzhou plant employs more than 500 engineers, technicians and operators, all of whom are expected to transfer to Fabrinet and continue their employment at the site. Fabrinet said it intends to utilize the existing core management and technical expertise at the site to grow its optical component business in China and in other regions the company serves.

JDS Eyes Reduced Cost Structure

Fabrinet has been providing manufacturing services to JDS Uniphase since 2000. In December 2004 the company acquired JDS Uniphase manufacturing facilities in Singapore and Bintan, Indonesia. Earlier this month, JDS Uniphase announced its intent to divest U.S. manufacturing facilities in Ewing and Mountain Lakes, N.J., to Fabrinet as part of broader cost-savings initiatives.

"Transferring ownership of our facility and operations in Fuzhou, China, to our contract manufacturing partner, Fabrinet, is part of our ongoing strategy to decrease cost structure for profitability while streamlining our portfolio along strategic core product lines to increase our corporate agility," said Minoo Zohouri, vice president of global materials for JDS Uniphase.

"It is a natural evolution for Fabrinet to acquire the JDS Uniphase operation in Fuzhou," said Tom Mitchell, founder and CEO of Fabrinet. "We have been manufacturing precision optical components since our inception and have had a long, successful relationship with JDS Uniphase. Expanding our Asian operations to China and growing our optical component manufacturing operations in that market will enable Fabrinet to provide greater flexibility and support to our existing customers and additional resources to attract new customers."

Fabrinet is based in Bangkok, with over 350,000 square feet of manufacturing and 3,600 employees, and it maintains sales offices in the United States and Europe.

Additional Articles of Interest

For more information on the challenges and opportunities presented by increasingly global supply chains, see the special in-depth report in the August/September 2004 issue of Supply & Demand Chain Executive, which includes the following articles:

For more information on the global supply chain, with a focus on security issues, see "Building the Secure Supply Chain," the Net Best Thing article in the June/July 2003 issue of iSource Business (now Supply & Demand Chain Executive) magazine.