June 30, 2006 – Ultra Clean Holdings Inc., a supplier of subsystems for semiconductor and flat-panel manufacturing equipment, has agreed to acquire contract subsystems manufacturer/supplier Sieger Engineering Inc. in a move to add to its manufacturing base and expand to markets outside the gas-delivery segment.
Under terms of the deal, Ultra Clean will pay $50 million — $16 million in cash plus 2.47 million shares of stock — as well as assume approximately $15 million in debt. The transaction is expected to be accretive to earnings for the balance of 2006 and for all of 2007.
South San Francisco-based Sieger, founded in 1981, posted about $86 million in revenue and $4 million in operating income in 2005. Combined, the two firms would have posted 2005 revenues of $234 million, vs. a combined $147 million in 2004.
With the acquisition, Ultra Clean expects to expand its markets and leverage its existing operations in China, while adding outsourced manufacturing capabilities. “We also expect to significantly increase our non-gas delivery subsystem revenue and subsystem integration capabilities, since there is no overlap among our product lines,” noted CEO Clarence Granger.