Sanmina acquires SCI Systems for $6 billion

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San Jose--In a sign of further consolidation in the computer field, Sanmina Corp., which produces telephone equipment and computers, has agreed to buy rival SCI Systems Inc. for about $6 billion in stock and assumed debt. Debts were not disclosed. The new company will have sales of $14 billion a year and 100 plants in more than 20 countries. SCI has been hurt by falling demand for PCs while Sanmina has stuck to making higher-priced devices such as server computers and has relied less on lower-profit products such as PCs and cell phones. However, both companies have cut jobs as demand slackened among such customers as Cisco Systems Inc. and Nortel Networks Corp. Last month Sanmina cut 7,200 jobs, or 30% of its work force. Shares of Sanmina fell $1.20, or 5%, to $20.94 in early morning trading. SCI rose $2.28, or 11%, to $28.
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