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Imation Agrees to Buy Memorex

January 20, 2006|From Reuters

Imation Corp., a maker of data storage discs and tapes, said Thursday that it had agreed to buy Cerritos-based Memorex International Inc. for $330 million in cash and future payments of as much as $45 million.

Imation also reported fourth-quarter operating profit of $18.4 million, or 52 cents a share, compared with $1.8 million, or 5 cents, a year earlier. The results beat analysts' average forecast of 48 cents a share.

Shares of Imation, based in Oakdale, Minn., rose $2.35 to $47.95 in after-hours trading. The announcement was made after the close of regular trading, when the shares had fallen 18 cents to $45.60.

Memorex's majority owners, Hanny Holdings of Hong Kong and Investor Asia Ltd., have agreed to vote their combined 67% stake in favor of the deal, Imation said. The company said Memorex's headquarters would remain in Cerritos.

The slogan "Is it live or is it Memorex?," referring to the company's audiocassette tapes, made Memorex a household name in the 1970s.

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