TE Connectivity Announces Agreements to Sell its Touch Solutions and Professional Services Businesses


TE (Tyco Electronics) decides to divest the Touch group (Elo TouchSystems to most of us) for $380M. Estimated 2011 revenues were $411M for Elo. Purchased by the Gore Group which spent $1B (or so) on PEP Auto Stores. Interesting.
SCHAFFHAUSEN, Switzerland, April 10, 2012 /PRNewswire/ -- TE Connectivity Ltd. (NYSE: TEL) today announced that it has entered into an agreement to sell its Touch Solutions business to The Gores Group for $380 million.  The Company has also agreed to sell its TE Professional Services (TPS) business to BlueStream Professional Services, LLC, an affiliate of KGP Logistics, for $23.5 million.  The sale of Touch Solutions is subject to customary regulatory approvals.  Both transactions are expected to close in the Company's third fiscal quarter of 2012.

Results related to these businesses will be recast for prior periods and reported as discontinued operations on the Company's financial statements beginning with its fiscal second quarter ended March 30, 2012.  The Company expects to recognize in discontinued operations an after-tax loss in its fiscal second quarter of approximately $20 million related to these divestitures.

Touch Solutions, which has been reported as part of TE's Communications and Industrial Solutions segment, is a supplier of touch screens, touch monitors and all-in-one touch computers under the Elo TouchSystems brand.  The business generated sales of $413 million in fiscal 2011.

TPS, acquired as part of TE's acquisition of ADC in December 2010, has been reported in the Telecom Networks business of TE's Network Solutions segment.  TPS is a provider of engineering, furnishing and installation services to communication service providers.  TE reported sales of $121 million in fiscal 2011 for the TPS business.

FISCAL SECOND QUARTER OUTLOOK

The results of both businesses will be recast for prior periods and reported as discontinued operations on the Company's financial statements beginning with its fiscal second quarter ended March 30, 2012.  The expected impact on the outlook for the second quarter is as follows:

($ in Millions, except per share amounts)


Discontinued



Outlook Issued

Operations



January 25, 2012

Impact

Revised Outlook *

Q2 Sales    

$3,300  to  $3,400

($150)

$3,150  to   $3,250





Q2 GAAP EPS  

 $0.57    to   $0.61

($0.02)

 $0.55    to   $0.59





Q2 Adjusted EPS  

 $0.64    to   $0.68

($0.02)

 $0.62    to   $0.66








* from Continuing Operations

The Company will report results for its fiscal second quarter and provide an updated outlook for the fiscal third quarter and full year before trading begins on April 25, 2012.

Information about TE Connectivity's use of non-GAAP financial measures is described below.

ABOUT TE CONNECTIVITY
TE Connectivity is a global, $14 billion company that designs and manufactures approximately 500,000 products that connect and protect the flow of power and data inside the products that touch every aspect of our lives.  Our nearly 100,000 employees partner with customers in virtually every industry--from consumer electronics, energy and healthcare, to automotive, aerospace and communication networks--enabling smarter, faster, better technologies to connect products to possibilities.  Find more information about TE Connectivity at http://www.te.com.

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