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Entegris to move 20 percent of product revenues to Malaysian facility |
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Aug 03, 2007 at 12:15 PM |
 Entegris has said that it is closing down a fringe low revenue container cleaning equipment range and services business as well as shifting production, initially of four key product lines, to its manufacturing facility in Kulim, Malaysia.
"As we continue to look for ways to optimize our business, we have decided to exit a small, non-strategic line of cleaning equipment," said Gideon Argov, President and Chief Executive Officer. "In addition, we are in the process of transferring the manufacturing of four key product lines from our U.S.-based manufacturing sites to our facility in Kulim, Malaysia."
In a conference call with financial analysts to discuss quarterly results, executives said that one of the product lines that is to be included in the move is its 300mm FOUP cassettes.
The other products related to recently introduced new lines that will not have to be re-qualified with customers. Executives said that approximately 7 percent of its revenues were related to the transfer of manufacturing to Malaysia with an estimated sales value in 2008 of US$35 million.
The company cited lower manufacturing costs, zero company tax for ten years and proximity to a growing number of Asia-based customers for the move.
Executives also said that its strategy going forward would be to reduce its manufacturing footprint in North America. It has a target of 20 percent of revenues coming from Malaysia over time. The cost of the initial shift was put at US$4 million over nine months.
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