ASUSTek and Advantech Announce Strategic Alliance
Cincinnati, Ohio - 10/27/2005) - ASUSTek and Advantech announce that the two companies will enter a strategic alliance through a share swap. ASUSTek and Advantech are the global leaders in commercial and industrial computing respectively. ASUSTek and Advantech will collaborate on new product developments, manufacturing, quality, and set up a joint venture (tentatively AdvanSus) to pursue new business opportunities in industrial computing. Combining their respective complimentary core competences, ASUSTek and Advantech will exert their efforts to develop the highly potential Industrial computing segments, address the customer needs, and create shareholders value.
Under the terms of the strategic alliance agreement, ASUSTek will hold 15% of Advantech's share, one seat on Advantech's Board of Directors, and one supervisor. Advantech will own 1.4% of ASUSTek's shares. ASUSTek will issue new shares in exchange of 10% of Advantech's share after Advantech's capital increase. For the remaining 5%, Advantech will arrange specific current shareholders to make the share exchange with ASUSTek. The swap ratio is set at 1.13 shares of Advantech to 1 share of ASUSTek. The ratio is mainly derived from both companies' recent stock market prices, with reference to other key performance indicators such as net worth per share, earnings per share, and future business potentials.
ASUSTek and Advantech will contribute dedicated talents and resources to the new joint venture, which will enter the highly potential markets such as industrial computing Design & Manufacturing Service (D&MS), industrial mobile, industrial motherboard, and industrial server segments. The joint venture is expected to start operation mid-2006.
Mr. Jonney Shih, Chief Executive Officer, ASUSTek, states that "Under the leadership of Mr. KC Liu, Advantech has created high brand value and outstanding business results in industrial computing. It is a respectable learning model.
Through many years of efforts, ASUSTek has established a solid foundation in commercial computing related areas, such as motherboard, graphic cards, and notebook. ASUSTek will continue developing products of superior performance via internal R&D and other functions' efforts. Through the strategic alliance with Advantech, a best-in-class company, ASUSTek expects to further create synergy in industrial computing, and heads toward a world-class leading hi-tech company.
In the future, Advantech and ASUSTek will dedicate to offering customers more competitive technologies, quality, efficiency, cost and flexibility. Both companies will excel from the win-win partnership."
Mr. KC Liu, Chief Executive Officer, Advantech, states that "The vision for Advantech to ally with ASUSTek is to leverage ASUSTek's expertise in quality, R&D and cost control, which will take the low-volume, high-customization, and service-driven industrial computing to the next level. The alliance will enter the industrial computing Design & Manufacturing Service (D&MS), industrial mobile, industrial motherboard, and industrial server segments. The long-term goal is that ASUSTek and Advantech, the two global brands, will enhance each other's leading positions in the commercial computing and industrial computing areas.
In addition to the complimentary technologies, ASUSTek and Advantech are very similar in management philosophy and company culture. I believe this is key to the success of the alliance. I consider Mr. Shih's leadership consistent with the level-five leader as described in my favorite book, Good to Great. I am very confident in the long-term development of this strategic alliance under the leadership of Mr. Shih."
About ASUSTek
ASUSTek Computer Inc. is the global leader in motherboard and graphics card notebooks. The product range covers 3C, and the business model is flexible between branding and OEM. With its outstanding technologies, ASUSTek has built the brand image and value as rock solid. The Company has won more than 1,171 prizes in 2004 and has been listed on BusinessWeek's "InfoTech 100" for a consecutive seven years. Moreover, ASUSTek's W1 Notebook is the first Chinese brand to be entitled Gold. ASUSTek's current market capital is around US$7.7 billion dollars. The Company's worldwide employees are more than 50,000. The estimated worldwide consolidated revenue is over US$10 billion dollars.
About Advantech
Advantech Co., Ltd. is the global leader in industrial computing industry. It is dedicated to long-term brand building, and providing customized platform design and development to customers. The company assists system integrators to provide multiple value-added solutions and services to meet customer needs in different areas. Advantech offers more than five hundred products and solutions, including motion control, measurements, communication, embedded computing, industrial motherboards, applied computing, and peripherals. Advantech's current market capital is approximately US$1 billion dollars. The estimated worldwide consolidated revenue is over US$400 million dollars. The Company has more than 2000 employees, and has operation in sixteen countries and thirty-five cities worldwide.
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Media website for more info, datasheets, etc.: http://www.advantech-eautomation.com/media
Chuck Harrell
Advantech Corporation, Industrial Automation Group
(513) 742-8895 x333
media info: http://www.advantech-eautomation.com/media
website: eAutomationPro.com
