IRVINE, Calif. , Oct. 24, 2013 /PRNewswire/ -- Newport Corporation (Nasdaq: NEWP) today announced it has signed a letter of intent to sell the assets of its Micro Robotics Systems advanced packaging business ("MRSI") to a private investment group led by the local management team. In the trailing twelve month period ended September 28, 2013, MRSI generated revenue of approximately $12 million, although the business did not contribute materially to Newport's operating income or cash flows.
Under the terms of the proposed transaction, Newport would receive $5.35 million in cash at closing and an unsecured promissory note in the principal amount of $0.65 million, with a term of seven years and an interest rate of 5%. The buyer is expected to sublease the facility from Newport and retain substantially all of the employees. The parties are currently negotiating the definitive agreements relating to the transaction, which will be subject to normal closing conditions and is expected to be finalized before the end of the year.
Commenting on the divestiture, Robert Phillippy, Newport's President and Chief Executive Officer, said: "The MRSI business is focused on the development and manufacturing of turn-key die bonding and dispensing systems. Our focus is on providing solutions that leverage lasers, optics and photonics technologies, and the MRSI business no longer fits within Newport's long-term strategy. Therefore, we believe it is in our best interest to sell the business. Doing so will allow Newport to more efficiently deploy management's attention and corporate resources to those areas that hold the greatest growth potential and best leverage the core capabilities of our company."
MRSI's net assets at the end of the third quarter of 2013 were approximately $9.5 million. Therefore, in accordance with generally accepted accounting principles, Newport will record a charge of $4.5 million in the third quarter of 2013 relating to the pending divestiture, including transaction costs of $0.4 million. More information on the transaction will be provided during the company's third quarter earnings conference call, which is scheduled for Wednesday, October 30, 2013 at 5:00 p.m. Eastern time ( 2:00 p.m. Pacific time).
ABOUT NEWPORT CORPORATION
Newport Corporation is a leading global supplier of advanced-technology products and systems to customers in the scientific research, microelectronics, life and health sciences, defense and security, and industrial manufacturing markets. Newport's innovative solutions leverage its expertise in advanced technologies, including lasers, photonics and precision motion equipment, and optical components and sub-systems, to enhance the capabilities and productivity of its customers' manufacturing, engineering and research applications. Newport is part of the Standard & Poor's SmallCap 600 Index and the Russell 2000 Index.
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SAFE HARBOR STATEMENT
This news release contains forward-looking statements, including without limitation statements regarding the expected terms and timing of the proposed divestiture and its expected impact on Newport. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Assumptions relating to the foregoing involve judgments and risks, all of which are difficult or impossible to predict accurately and many of which are beyond the control of Newport. Certain of these judgments and risks are discussed in more detail in Newport's periodic reports filed with the Securities and Exchange Commission. Although Newport believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated in forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by Newport or any other person that Newport's objectives or plans will be achieved. Newport undertakes no obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
Contact: Charles F. Cargile, 949/863-3144Newport Corporation,
Rob Fink, 212/896-1206KCSA Strategic Communications
SOURCE Newport Corporation