1. Sanmina acquires ZT Systems from AMD for up to $3 billion. 2. Transaction includes $2.25 billion cash and $450 million contingent payment. 3. Acquisition expected to boost EPS in the first year post-closing. 4. Deal unanimously approved by Sanmina's board, closing expected in late 2025. 5. Equity issued to AMD has a three-year lock-up period.
The acquisition enhances Sanmina's manufacturing capabilities, potentially driving growth. Historically, such acquisitions can lead to immediate EPS growth and market confidence, as seen with companies like Xilinx's acquisition by AMD and NVIDIA's expansion strategies.
The substantial size of the acquisition and its strategic fit signal strong growth potential for Sanmina. This impacts overall market sentiment positively and aligns with broader tech industry trends.
The acquisition's benefits will unfold over several years, particularly after the lock-up period. Long-term, this aligns with market trends towards AI and data center expansions, similar to successful acquisitions by tech manufacturers that have increased their market shares.