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Universal Electronics Acquires Enson Assets

Cypress, Calif. – Universal Electronics (UEI) has acquired China-based Enson Assets Limited. Enson is a China-based manufacturer of remote controls for OEMs. 

The company was acquired from CG International Holdings Limited for a net purchase value of approximately $110 million, according to a statement by the companies.  

“This acquisition further strengthens UEI’s leadership position in wireless control technology as it positions us to benefit from very promising international growth opportunities and significantly increases our market share in OEMs,” said Paul Arling, UEI’s chairman and CEO, in a statement. “We have a six-year history working with the C.G. companies, and we are excited to welcome their employee base, including experienced management and engineering groups, to UEI.”

Arling said the acquisition is expected to increase its growth in Asia. “This acquisition will also strengthen our customer list with key industry-leading consumer electronics companies including Sony, Panasonic and Toshiba,” he added.  

Bryan Hackworth, UEI chief financial officer, said the acquisition will add at least $140 million to its sales total and at least $20 million in operating income.

UEI also reported its financial results for the third quarter, ended Sept. 30. Net sales were $79 million, compared with $83.2 million in the prior-year period.  

Its business category revenue was $66.2 million, compared with $67 million, with the category contributing 84 percent.

The consumer category revenue was $12.8 million, compared with the prior year’s $16.2 million. Gross margins were 32.6 percent, compared with 31.3 percent.

Total operating expenses were $19.2 million, compared with $19.4 million, and operating income was $6.6 million, compared with $6.6 million.

Net income was $4.7 million, or 34 cents per diluted share, compared with $4.2 million, or 30 cents per diluted share, the company said.

Hackworth said: “While third-quarter 2010 sales were down slightly relative to the third quarter of 2009, we improved gross margins to 32.6 percent of sales and lowered our operating expenses. As a result, we delivered operating margin improvement, increasing from 8 percent in the third quarter of 2009 to 8.3 percent in the third quarter of 2010.”