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Micron Technology to Buy 89% Stake of PC Maker Zeos

October 18, 1994|From Bloomberg Business News

BOISE — Micron Technology Inc. said it signed a letter of intent to buy 89% of struggling personal computer maker Zeos International Ltd. for an undisclosed sum.

Under terms of the agreement, two units of Micron would trade their shares for 89% of the shares of Minneapolis-based Zeos. The remaining 11% would be held by existing shareholders, the companies said. Other terms of the transaction were not disclosed and company officials would not comment further.

Based on Zeos' closing stock price Friday, the stake is worth about $44.5 million.

Zeos shares closed unchanged Monday at $5 on Nasdaq volume of 1.3 million, more than 20 times its daily average volume of 64,000 for the past three months. Micron closed down 87.5 cents at $33.50.

Zeos, which had a loss of $13.4 million on $229.1 million in revenue in the last fiscal year, would become part of Micron Computer Inc. and Micron Custom Manufacturing Services Inc. Micron Computer makes personal computers and Micron Custom makes custom electronics for other electronics makers.

Last month, three top executives of Boise, Ida.-based Micron left the company over disagreements with the board about how fast the company should grow and whether the company should stay in the PC business. Micron makes semiconductor memory chips and other electronics for PCs.

The purchase shows that Micron is committing itself to the PC business, said Richard Whittington, an analyst at Soundview Financial Group.

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