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Filed Pursuant to Rule 424(b)(3)
Registration No. 333-60968
PROSPECTUS
FLEXTRONICS INTERNATIONAL LTD.
UP TO 1,104,076 ORDINARY SHARES
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The 1,104,076 ordinary shares covered by this prospectus were previously
issued by us in our acquisition of ASIC International, Inc. These ordinary
shares may be offered and sold over time by the shareholders named in this
prospectus under the heading "Selling Shareholders," by their pledgees or
donees, or by other transferees that receive the ordinary shares in transfers
other than public sales.
The selling shareholders may sell their Flextronics shares on Nasdaq, on
the over-the-counter market, in connection with the writing of exchange-traded
call options, in negotiated transactions or otherwise, and these sales may be at
prevailing market prices or in private transactions at negotiated prices. They
may sell the shares directly, or may sell them through underwriters, brokers or
dealers. Underwriters, brokers or dealers may receive discounts, concessions or
commissions from the selling shareholders, and this compensation might be in
excess of the compensation customary in the type of transaction involved. See
"Plan of Distribution."
We will not receive any of the proceeds from the sale of these shares.
The ordinary shares are quoted on the Nasdaq National Market under the
symbol "FLEX." On May 17, 2001, the closing sale price of the ordinary shares
was $29.58 per share.
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THIS INVESTMENT INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS"
BEGINNING ON PAGE 4.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is May 18, 2001.
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TABLE OF CONTENTS
PAGE
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Where You Can Find More Information......................... 2
Forward-Looking Statements.................................. 3
Flextronics International Ltd............................... 4
Enforcement of Civil Liabilities............................ 4
Risk Factors................................................ 4
Use of Proceeds............................................. 10
Selling Shareholders........................................ 10
Plan of Distribution........................................ 11
Legal Matters............................................... 13
Experts..................................................... 13
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. We have filed with the SEC a registration statement on
Form S-3 under the Securities Act with respect to the ordinary shares offered
under this prospectus. This prospectus does not contain all of the information
in the registration statement, parts of which we have omitted, as allowed under
the rules and regulations of the SEC. You should refer to the registration
statement for further information with respect to us and our ordinary shares.
Copies of this registration statement, along with the reports, proxy statements
and other information filed with the SEC, may be read and copied at the SEC's
public reference room at 450 Fifth Street, N.W., Washington D.C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the public reference
rooms. Our SEC filings are also available on the SEC's website at
"http://www.sec.gov."
The SEC allows us to "incorporate by reference" information from other
documents that we file with them, which means that we can disclose important
information by referring to those documents. The information incorporated by
reference is considered to be part of this prospectus, and information that we
file later with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below, and any
future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934 prior to the sale of all the shares covered
by this prospectus:
- our Annual Report on Form 10-K for the fiscal year ended March 31, 2000;
- our Quarterly Reports on Form 10-Q for the fiscal quarters ended June 30,
2000, September 30, 2000 and December 31, 2000;
- our Current Reports on Form 8-K filed with the Commission on April 18,
2000, June 13, 2000, June 19, 2000, June 22, 2000, June 27, 2000,
September 15, 2000, September 20, 2000, September 20, 2000, November 14,
2000, January 29, 2001, February 1, 2001 and February 8, 2001; and
- the description of our ordinary shares contained in our Registration
Statement on Form 8-A dated January 31, 1994.
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You may request a copy of these filings, at no cost, by writing or
telephoning us at:
Flextronics International Ltd.
c/o Flextronics International USA, Inc.
2245 Lundy Drive
San Jose, California 95131
Attention: Laurette F. Slawson
Treasurer and Director of Investor Relations
Telephone: (408) 576-7000
You may also review copies of documents that are incorporated by reference
at our web site. The address of the site is http://www.flextronics.com.
Information contained in our website does not constitute a part of this
prospectus.
You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement, other than any information
superseded by a later document filed with the SEC and incorporated by reference
in this prospectus. We have not authorized anyone else to provide you with
different information. The selling shareholders may not make an offer of these
shares in any state where the offer is not permitted. You should not assume that
the information in this prospectus or any supplement is accurate as of any date
other than the date on the front of those documents.
FORWARD-LOOKING STATEMENTS
This prospectus, including the documents incorporated by reference in the
prospectus, contains forward-looking statements. The words "will," "may,"
"designed to," "outlook," "believes," "should," "anticipates," "plans,"
"expects," "intends," "estimates" and similar expressions identify these
forward-looking statements. These forward-looking statements are contained
principally under the headings "Flextronics International Ltd." and "Risk
Factors." Because these forward-looking statements are also subject to risks and
uncertainties, actual results may differ materially from the expectations
expressed in the forward-looking statements. Important factors that could cause
actual results to differ materially from the expectations reflected in the
forward-looking statements include those described in "Risk Factors," as well
as:
- our ability to integrate acquired companies and manage expanding
operations;
- fluctuations in our customers' requirements and in demand for their
products;
- our strategic relationship with Ericsson;
- increased competition;
- component shortages;
- the risks of the photonics market, including the emergence of new
technologies;
- tax matters; and
- currency fluctuations.
In addition, these forward-looking statements are subject to the other
risks and uncertainties discussed under "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Certain Factors Affecting
Operating Results" in our most recent reports filed with the Securities and
Exchange Commission on Form 10-K and Form 10-Q. We undertake no obligation to
update or revise these forward-looking statement to reflect subsequent events or
circumstances.
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FLEXTRONICS INTERNATIONAL LTD.
We are the second largest provider of advanced electronics manufacturing
services to original equipment manufacturers, or OEMs, primarily in the
telecommunications, networking, consumer electronics and computer industries. We
provide a network of design, engineering and manufacturing operations in 27
countries across four continents. Our strategy is to provide customers with
end-to-end solutions where we take responsibility for engineering, supply chain
management, new product introduction and implementation, manufacturing and
logistics management, with the goal of delivering of a complete packaged
product. Our manufacturing services include the fabrication and assembly of
plastic and metal enclosures, PCBs and backplanes and the assembly of complete
systems and products. In addition, through our photonics division, we
manufacture and assemble photonics components and integrate them into PCB
assemblies and other systems. Throughout the production process, we offer design
and technology services; logistics services, such as materials procurement,
inventory management, vendor management, packaging and distribution; and
automation of key components of the supply chain through advanced information
technologies. In addition, we have added other after-market services such as
network installation. We believe that our size and global presence, our ability
to provide a full spectrum of design, manufacturing and logistics services and
our advanced information technology expertise enable us to win large programs
from leading multinational OEMs for the manufacture of advanced electronics
products.
ENFORCEMENT OF CIVIL LIABILITIES
We are incorporated in Singapore under the Companies Act. Some of our
directors and executive officers reside in Singapore. All or a substantial
portion of the assets of such persons, and a substantial portion of our assets,
are located outside the United States. As a result, it may not be possible for
persons purchasing ordinary shares to effect service of process within the
United States upon such persons or Flextronics or to enforce against them, in
the United States courts, judgments obtained in such courts predicated upon the
civil liability provisions of the federal securities laws of the United States.
We have been advised by our Singapore legal advisors, Allen & Gledhill, that
there is doubt as to the enforceability in Singapore courts, either in original
actions or in actions for the enforcement of judgments of United States courts,
of civil liabilities predicated upon the federal securities laws of the United
States.
RISK FACTORS
This offering involves a high degree of risk. You should carefully consider
the risks described below and the other information in this prospectus,
including the information incorporated by reference, before deciding to invest
in our ordinary shares. If any of the risks described below materializes, our
operating results and financial condition could be adversely affected and the
trading price of our ordinary shares could decline.
IF WE DO NOT MANAGE EFFECTIVELY THE EXPANSION OF OUR OPERATIONS, OUR BUSINESS
MAY BE HARMED.
We have grown rapidly in recent periods. Our workforce has more than
doubled in size over the last year as a result of internal growth and
acquisitions. This growth is likely to strain considerably our management
control system and resources, including decision support, accounting management,
information systems and facilities. If we do not continue to improve our
financial and management controls, reporting systems and procedures to manage
our employees effectively and to expand our facilities, our business could be
harmed.
We plan to increase our manufacturing capacity by expanding our facilities
and adding new equipment. Such expansion involves significant risks, including,
but not limited to, the following:
- we may not be able to attract and retain the management personnel and
skilled employees necessary to support expanded operations;
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- we may not efficiently and effectively integrate new operations and
information systems, expand our existing operations and manage
geographically dispersed operations;
- we may incur cost overruns;
- we may encounter construction delays, equipment delays or shortages,
labor shortages and disputes and production start-up problems that could
harm our growth and our ability to meet customers' delivery schedules;
and
- we may not be able to obtain funds for this expansion, and we may not be
able to obtain loans or operating leases with attractive terms.
In addition, we expect to incur new fixed operating expenses associated
with our expansion efforts that will increase our cost of sales, including
substantial increases in depreciation expense and rental expense. If our
revenues do not increase sufficiently to offset these expenses, our operating
results would be seriously harmed. Our expansion, both through internal growth
and acquisitions, has contributed to our incurring significant accounting
charges. For example, in connection with our acquisitions of The DII Group, Inc.
Palo Alto Products International Pte. Ltd., Chatham Technologies, Inc., or
Chatham, and Lightning Metal Specialties and related entities, or Lightning, we
recorded merger related charges of approximately $255.0 million, net of tax, and
in connection with the issuance of an equity instrument to Motorola relating to
our alliance with Motorola, we recorded a one-time non-cash charge of
approximately $286.5 million.
OUR STRATEGIC RELATIONSHIP WITH ERICSSON CREATES RISKS.
We recently entered into a definitive agreement with Ericsson with respect
to our management of its mobile telephone operations. Our ability to achieve any
of the anticipated benefits of this new relationship with Ericsson is subject to
a number of risks, including our ability to meet Ericsson's volume, product
quality, timeliness and price requirements, and to achieve anticipated cost
reductions. If demand for Ericsson's mobile phone products declines, Ericsson
may purchase a lower quantity of products from us than we anticipate. If
Ericsson's requirements exceed the volume anticipated by us, we may not be able
to meet these requirements on a timely basis. Our inability to meet Ericsson's
volume, quality, timeliness and cost requirements, and to quickly resolve any
issues with Ericsson, could seriously harm our results of operations. As a
result of these and other risks, we may be unable to achieve anticipated levels
of profitability under this arrangement, and it may not result in any material
revenues or contribute positively to our net income per share. Finally, other
OEMs may not wish to obtain logistics or operations management services from us.
WE MAY ENCOUNTER DIFFICULTIES WITH ACQUISITIONS, WHICH COULD HARM OUR BUSINESS.
In the past year, we completed a significant number of acquisitions of
businesses and facilities, including our acquisitions of Chatham, JIT Holdings
Ltd. and Lightning. We expect to continue to acquire additional businesses and
facilities in the future. We are currently in preliminary discussions to acquire
additional businesses and facilities. Any future acquisitions may require
additional debt or equity financing, which could increase our leverage or be
dilutive to our existing shareholders. We cannot assure the terms of, or that we
will complete, any acquisitions in the future.
To integrate acquired businesses, we must implement our management
information systems and operating systems and assimilate and manage the
personnel of the acquired operations. The difficulties of this integration may
be further complicated by geographic distances. The integration of acquired
businesses may not be successful and could result in disruption to other parts
of our business.
In addition, acquisitions involve a number of other risks and challenges,
including, but not limited to:
- diversion of management's attention;
- potential loss of key employees and customers of the acquired companies;
- lack of experience operating in the geographic market of the acquired
business; and
- an increase in our expenses and working capital requirements.
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Any of these and other factors could harm our ability to achieve
anticipated levels of profitability at acquired operations or realize other
anticipated benefits of an acquisition.
OUR OPERATING RESULTS VARY SIGNIFICANTLY.
We experience significant fluctuations in our results of operations. The
factors that contribute to fluctuations include:
- the timing of customer orders;
- the volume of these orders relative to our capacity;
- market acceptance of customers' new products;
- changes in demand for customers' products and product obsolescence;
- our ability to manage the timing and amount of our procurement of
components to avoid delays in production and excess inventory levels;
- the timing of our expenditures in anticipation of future orders;
- our effectiveness in managing manufacturing processes and costs;
- changes in the cost and availability of labor and components;
- changes in our product mix;
- changes in economic conditions;
- local factors and events that may affect our production volume, such as
local holidays; and
- seasonality in customers' product requirements.
One of our significant end-markets is the consumer electronics market. This
market exhibits particular strength toward the end of the calendar year in
connection with the holiday season. As a result, we have historically
experienced relative strength in revenues in our third fiscal quarter.
We are reconfiguring certain of our operations to further increase our
concentration in low-cost locations. This shift of operations resulted in a
restructuring charge of $276 million, net of tax, in the fourth quarter of
fiscal 2001. In addition, some of our customers are currently experiencing
increased volatility in demand, and in some cases reduced demand, for their
products. This increases the difficulty of anticipating the levels and timing of
future revenues from these customers, and could lead them to defer delivery
schedules for products, which could lead to a reduction or delay in such
revenues. Any of these factors or a combination of these factors could seriously
harm our business and result in fluctuations in our results of operations.
WE HAVE NEW STRATEGIC RELATIONSHIPS FROM WHICH WE ARE NOT YET RECEIVING
SIGNIFICANT REVENUES, AND MAY NOT REACH ANTICIPATED LEVELS.
We have recently announced major new strategic relationships, including our
alliances with Ericsson and Motorola, from which we anticipate significant
future revenues. However, similar to our other customer relationships, there are
no volume purchase commitments under these new programs, and the revenues we
actually achieve may not meet our expectations. In anticipation of future
activities under these programs, we are incurring substantial expenses as we add
personnel and manufacturing capacity and procure materials. Our operating
results will be seriously harmed if sales do not develop to the extent and
within the time frame we anticipate.
OUR CUSTOMERS MAY CANCEL THEIR ORDERS, CHANGE PRODUCTION QUANTITIES OR DELAY
PRODUCTION.
Electronics manufacturing service providers must provide increasingly rapid
product turnaround for their customers. We generally do not obtain firm,
long-term purchase commitments from our customers
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and we continue to experience reduced lead-times in customer orders. Customers
may cancel their orders, change production quantities or delay production for a
number of reasons. Cancellations, reductions or delays by a significant customer
or by a group of customers would seriously harm our results of operations.
In addition, we make significant decisions, including determining the
levels of business that we will seek and accept, production schedules, component
procurement commitments, personnel needs and other resource requirements, based
on our estimates of customer requirements. The short-term nature of our
customers' commitments and the possibility of rapid changes in demand for their
products reduce our ability to estimate accurately future customer requirements.
This makes it difficult to schedule production and maximize utilization of our
manufacturing capacity. We often increase staffing, purchase materials and incur
other expenses to meet the anticipated demand of our customers. Anticipated
orders may not materialize, and delivery schedules may be deferred as a result
of changes in demand for our customers' products. On occasion, customers may
require rapid increases in production, which can stress our resources and reduce
margins. Although we have increased our manufacturing capacity, and plan further
increases, we may not have sufficient capacity at any given time to meet our
customers' demands. In addition, because many of our costs and operating
expenses are relatively fixed, a reduction in customer demand could harm our
gross margins and operating income.
WE DEPEND ON THE CONTINUING TREND OF OUTSOURCING BY OEMS.
A substantial factor in our revenue growth is the transfer of manufacturing
and supply base management activities from our OEM customers. Future growth
partially depends on new outsourcing opportunities. To the extent that these
opportunities are not available, our future growth would be unfavorably
impacted. These outsourcing opportunities may include the transfer of assets
such as facilities, equipment and inventory.
THE MAJORITY OF OUR SALES COMES FROM A SMALL NUMBER OF CUSTOMERS; IF WE LOSE ANY
OF THESE CUSTOMERS, OUR SALES COULD DECLINE SIGNIFICANTLY.
Sales to our ten largest customers have represented a significant
percentage of our net sales in recent periods. Our ten largest customers in the
first nine months of fiscal 2001 and 2000 accounted for approximately 56% and
59% of net sales. Our two largest customers during the first nine months of
fiscal 2001 were Cisco and Ericsson, accounting for approximately 11% and 10% of
net sales. We expect that our strategic relationship with Ericsson will
substantially increase the percentage of our sales attributable to Ericsson. No
other customers accounted for more than 10% of net sales in the first nine
months of fiscal 2001. The identity of our principal customers have varied from
year to year, and our principal customers may not continue to purchase services
from us at current levels, if at all. Significant reductions in sales to any of
these customers, or the loss of major customers, would seriously harm our
business. If we are not able to timely replace expired, canceled or reduced
contracts with new business, our revenues would be harmed.
WE DEPEND ON THE TELECOMMUNICATIONS, NETWORKING AND ELECTRONICS INDUSTRIES WHICH
CONTINUALLY PRODUCE TECHNOLOGICALLY ADVANCED PRODUCTS WITH SHORT LIFE CYCLES;
OUR INABILITY TO CONTINUALLY MANUFACTURE SUCH PRODUCTS ON A COST-EFFECTIVE BASIS
WOULD HARM OUR BUSINESS.
We depend on sales to customers in the telecommunications, networking and
electronics industries. Factors affecting these industries in general could
seriously harm our customers and, as a result, us. These factors include:
- the inability of our customers to adapt to rapidly changing technology
and evolving industry standards, which results in short product life
cycles;
- the inability of our customers to develop and market their products, some
of which are new and untested, the potential that our customers' products
may become obsolete or the failure of our customers' products to gain
widespread commercial acceptance; and
- recessionary periods in our customers' markets.
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If any of these factors materialize, our business would suffer. Recently,
many sectors of the telecommunications, networking and electronics industries
have experienced pricing and margin pressures and reduced demand for many
products, and the impact of these pressures has caused, and is expected to
continue to cause, some customers to defer delivery schedules for certain
products that we manufacture for them.
OUR INDUSTRY IS EXTREMELY COMPETITIVE.
The electronics manufacturing services industry is extremely competitive
and includes hundreds of companies, several of which have achieved substantial
market share. Current and prospective customers also evaluate our capabilities
against the merits of internal production. Some of our competitors have
substantially greater market share and manufacturing, financial and marketing
resources than us.
In recent years, many participants in the industry, including us, have
substantially expanded their manufacturing capacity. If overall demand for
electronics manufacturing services should decrease, this increased capacity
could result in substantial pricing pressures, which could seriously harm our
operating results.
WE MAY BE ADVERSELY AFFECTED BY SHORTAGES OF REQUIRED ELECTRONIC COMPONENTS.
A substantial majority of our net sales are derived from turnkey
manufacturing in which we are responsible for purchasing components used in
manufacturing our customers' products. We generally do not have long-term
agreements with suppliers of components. This typically results in our bearing
the risk of component price increases because we may be unable to procure the
required materials at a price level necessary to generate anticipated margins
from our agreements with our customers. Accordingly, component price changes
could seriously harm our operating results.
At various times, there have been shortages of some of the electronic
components that we use, and suppliers of some components have lacked sufficient
capacity to meet the demand for these components. Component shortages have
recently become more prevalent in our industry. In some cases, supply shortages
and delays in deliveries of particular components have resulted in curtailed
production, or delays in production, of assemblies using that component, which
has contributed to an increase in our inventory levels. We expect that shortages
and delays in deliveries of some components will continue. If we are unable to
obtain sufficient components on a timely basis, we may experience manufacturing
and shipping delays, which could harm our relationships with current or
prospective customers and reduce our sales.
OUR CUSTOMERS MAY BE ADVERSELY AFFECTED BY RAPID TECHNOLOGICAL CHANGE.
Our customers compete in markets that are characterized by rapidly changing
technology, evolving industry standards and continuous improvement in products
and services. These conditions frequently result in short product life cycles.
Our success will depend largely on the success achieved by our customers in
developing and marketing their products. If technologies or standards supported
by our customers' products become obsolete or fail to gain widespread commercial
acceptance, our business could be adversely affected.
WE ARE SUBJECT TO THE RISK OF INCREASED INCOME TAXES.
We have structured our operations in a manner designed to maximize income
in countries where (1) tax incentives have been extended to encourage foreign
investment or (2) income tax rates are low. We base our tax position upon the
anticipated nature and conduct of our business and upon our understanding of the
tax laws of the various countries in which we have assets or conduct activities.
However, our tax position is subject to review and possible challenge by taxing
authorities and to possible changes in law which may have retroactive effect. We
cannot determine in advance the extent to which some jurisdictions may require
us to pay taxes or make payments in lieu of taxes.
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Several countries in which we are located allow for tax holidays or provide
other tax incentives to attract and retain business. We have obtained holidays
or other incentives where available. Our taxes could increase if certain tax
holidays or incentives are not renewed upon expiration, or tax rates applicable
to us in such jurisdictions are otherwise increased. In addition, further
acquisitions of businesses may cause our effective tax rate to increase.
WE CONDUCT OPERATIONS IN A NUMBER OF COUNTRIES AND ARE SUBJECT TO RISKS OF
INTERNATIONAL OPERATIONS.
The geographical distances between Asia, the Americas and Europe create a
number of logistical and communications challenges. Our manufacturing operations
are located in a number of countries throughout East Asia, the Americas and
Europe. As a result, we are affected by economic and political conditions in
those countries, including:
- fluctuations in the value of currencies;
- changes in labor conditions;
- longer payment cycles;
- greater difficulty in collecting accounts receivable;
- the burdens and costs of compliance with a variety of foreign laws;
- political and economic instability;
- increases in duties and taxation;
- imposition of restrictions on currency conversion or the transfer of
funds;
- limitations on imports or exports;
- expropriation of private enterprises; and
- a potential reversal of current tax or other policies encouraging foreign
investment or foreign trade by our host countries.
The attractiveness of our services to our U.S. customers can be affected by
changes in U.S. trade policies, such as "most favored nation" status and trade
preferences for some Asian nations. In addition, some countries in which we
operate, such as Brazil, the Czech Republic, Hungary, Mexico, Malaysia and
Poland, have experienced periods of slow or negative growth, high inflation,
significant currency devaluations or limited availability of foreign exchange.
Furthermore, in countries such as Mexico and China, governmental authorities
exercise significant influence over many aspects of the economy, and their
actions could have a significant effect on us. Finally, we could be seriously
harmed by inadequate infrastructure, including lack of adequate power and water
supplies, transportation, raw materials and parts in countries in which we
operate.
WE ARE SUBJECT TO RISKS OF CURRENCY FLUCTUATIONS AND HEDGING OPERATIONS.
A significant portion of our business is conducted in the European euro,
the Swedish krona and the Brazilian real. In addition, some of our costs, such
as payroll and rent, are denominated in local currencies in the countries in
which we operate. In recent years, some of these currencies, including the
Hungarian forint, Brazilian real and Mexican peso, have experienced significant
devaluations. Changes in exchange rates between these and other currencies and
the U.S. dollar will affect our cost of sales, operating margins and revenues.
We cannot predict the impact of future exchange rate fluctuations. We use
financial instruments, primarily forward purchase contracts, to hedge Japanese
yen, European euro, U.S. dollar and other foreign currency commitments arising
from trade accounts payable and fixed purchase obligations. Because we hedge
only fixed obligations, we do not expect that these hedging activities will harm
our results of operations or cash flows. However, our hedging activities may be
unsuccessful, and we may change or reduce our hedging activities in the future.
As a result, we may experience significant unexpected expenses from fluctuations
in exchange rates.
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WE DEPEND ON OUR KEY PERSONNEL.
Our success depends to a large extent upon the continued services of our
key executives, managers and skilled personnel. Generally our employees are not
bound by employment or non-competition agreements, and we cannot assure that we
will retain our key officers and employees. We could be seriously harmed by the
loss of key personnel. In addition, in order to manage our growth, we will need
to recruit and retain additional skilled management personnel and if we are not
able to do so, our business and our ability to continue to grow would be harmed.
WE ARE SUBJECT TO ENVIRONMENTAL COMPLIANCE RISKS.
We are subject to various federal, state, local and foreign environmental
laws and regulations, including those governing the use, storage, discharge and
disposal of hazardous substances in the ordinary course of our manufacturing
process. In addition, we are responsible for cleanup of contamination at some of
our current and former manufacturing facilities and at some third party sites.
If more stringent compliance or cleanup standards under environmental laws or
regulations are imposed, or if the results of future testing and analysis at our
current or former operating facilities indicate that we are responsible for the
release of hazardous substances, we may be subject to additional remediation
liability. Further, additional environmental matters may arise in the future at
sites where no problem is currently known or at sites that we may acquire in the
future. Currently unexpected costs that we may incur with respect to
environmental matters may result in additional loss contingencies, the
quantification of which cannot be determined at this time.
THE MARKET PRICE OF OUR ORDINARY SHARES IS VOLATILE.
The stock market in recent years has experienced significant price and
volume fluctuations that have affected the market prices of technology
companies. These fluctuations have often been unrelated to or disproportionately
impacted by the operating performance of these companies. The market for our
ordinary shares may be subject to similar fluctuations. Factors such as
fluctuations in our operating results, announcements of technological
innovations or events affecting other companies in the electronics industry,
currency fluctuations and general market conditions may have a significant
effect on the market price of our ordinary shares.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of shares by the
selling shareholders.
SELLING SHAREHOLDERS
The following table sets forth information regarding the selling
shareholders, the shares that may be offered and sold from time to time by the
selling shareholders pursuant to this prospectus, and the nature of any
position, office or other material relationship which each selling shareholder
has had with Flextronics. The selling shareholders named below, together with
any pledgee or donee of any named shareholders, and any person who may purchase
shares offered hereby from any named shareholders in a private transaction in
which they are assigned the shareholders' rights to registration of their
shares, are referred to in this prospectus as the "selling shareholders."
Except as indicated below, the shares that may be offered and sold pursuant
to this prospectus represent all of the shares owned by each named selling
shareholder as of May 10, 2001. All of these shares were acquired by the selling
shareholders in connection with our acquisition of ASIC International, Inc.
Percentage ownership is based upon 481,553,758 outstanding ordinary shares as of
May 10, 2001.
The selling shareholders may offer from time to time all or some of their
shares under this prospectus. Because the selling shareholders are not obligated
to sell their shares, and because the selling shareholders
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also may acquire our publicly traded ordinary shares, we cannot estimate how
many shares the selling shareholders will own after this offering.
SHARES BENEFICIALLY
OWNED
PRIOR TO THE OFFERING
---------------------- SHARES BEING
NAME NUMBER PERCENT OFFERED
---- --------- --------- ------------
J. Mark Goode(1)............................................ 244,392 * 244,392
Nancy Hahne(2).............................................. 244,392 * 244,392
Daniel J. Lincoln(3)........................................ 244,392 * 244,392
James Vig Sherrill(4)....................................... 244,392 * 244,392
Max S. Lloyd(5)............................................. 115,008 * 115,008
William A. Malkes(6)........................................ 11,500 * 11,500
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* Less than 1%.
(1) J. Mark Goode is an employee of a subsidiary of Flextronics and was an
officer, director and majority shareholder of ASIC International, Inc. until
its acquisition by Flextronics.
(2) Nancy Hahne was a director and significant shareholder of ASIC
International, Inc. until its acquisition by Flextronics.
(3) Daniel J. Lincoln is an employee of a subsidiary of Flextronics and was an
officer, director and significant shareholder of ASIC International, Inc.
until its acquisition by Flextronics.
(4) James Vig Sherrill is an employee of a subsidiary of Flextronics and was an
officer, director and significant shareholder of ASIC International, Inc.
until its acquisition by Flextronics.
(5) Max S. Lloyd is an employee of a subsidiary of Flextronics and was an
officer and significant shareholder of ASIC International, Inc. until its
acquisition by Flextronics.
(6) William A. Malkes is an employee of a subsidiary of Flextronics and was an
officer and significant shareholder of ASIC International, Inc. until its
acquisition by Flextronics.
PLAN OF DISTRIBUTION
The selling shareholders may sell or distribute some or all of the shares
from time to time through underwriters, dealers, brokers or other agents or
directly to one or more purchasers, including pledgees. The selling shareholders
may sell the shares on the Nasdaq National Market, in the over-the-counter
market or otherwise, at market prices prevailing at the time of sale, at prices
related to the prevailing market prices, or at negotiated prices or at fixed
prices, which may be changed. The selling shareholders may offer and sell some
or all of their shares through:
- a block trade in which a broker-dealer or other person may resell all or
part of the block, as principal or agent, in order to facilitate the
transaction;
- purchases by a broker-dealer or other person, as principal, and resales
by the broker-dealer for its account;
- pledges of shares to a broker-dealer or other person, who may, in the
event of default, purchase or sell the pledged shares; or
- ordinary brokerage transactions and transactions in which a broker
solicits purchasers.
In addition, selling shareholders may enter into option, derivative or
hedging transactions with respect to the shares, and any related offers or sales
of shares may be made pursuant to this prospectus. For example, the selling
shareholders may:
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- enter into transactions involving short sales of the shares by
broker-dealers in the course of hedging the positions they assume with
selling shareholders;
- sell shares short themselves and deliver the shares registered hereby to
settle such short sales or to close out stock loans incurred in
connection with their short positions;
- write call options, put options or other derivative instruments
(including exchange-traded options or privately negotiated options) with
respect to the shares, or which they settle through delivery of the
shares;
- enter into option transactions or other types of transactions that
require the selling shareholder to deliver shares to a broker, dealer or
other financial institution, who may then resell or transfer the shares
under this prospectus; or
- loan the shares to a broker, dealer or other financial institution, which
may sell the loaned shares.
These option, derivative and hedging transactions may require the delivery
to a broker, dealer or other financial institution of shares offered hereby, and
such broker, dealer or other financial institution may resell such shares
pursuant to this prospectus. Selling shareholders also may resell all or a
portion of the shares in open market transactions in reliance upon Rule 144
under the Securities Act, provided they meet the criteria and comply with the
requirements of that rule.
Brokers, dealers, agents or underwriters participating in transactions as
agent may receive compensation in the form of discounts, concessions or
commissions from the selling shareholders (and, if they act as agent for the
purchaser of the shares, from such purchaser). The discounts, concessions or
commissions as to a particular broker, dealer, agent or underwriter might be in
excess of those customary in the type of transaction involved. This prospectus
also may be used by donees of the selling shareholders, or by other persons
acquiring shares who wish to offer and sell shares under circumstances requiring
or making desirable its use.
The selling shareholders and any underwriters, brokers, dealers or agents
that participate in such distribution may be deemed to be "underwriters" within
the meaning of the Securities Act, and any discounts, commissions or concessions
received by any underwriters, brokers, dealers or agents might be deemed to be
underwriting discounts and commissions under the Securities Act. Neither
Flextronics nor the selling shareholders can presently estimate the amount of
such compensation.
We will pay substantially all of the expenses incident to this offering of
the shares by the selling shareholders to the public other than commissions and
discounts of underwriters, brokers, dealers or agents. We have agreed to
indemnify the selling shareholders against certain liabilities, including
liabilities arising under the Securities Act, in connection with the offer and
sale of the shares, and selling shareholders may indemnify brokers, dealers,
agents or underwriters that participate in transactions involving sales of the
shares against certain liabilities, including liabilities arising under the
Securities Act.
In order to comply with certain states' securities laws, if applicable, the
shares will be sold in jurisdictions only through registered or licensed brokers
or dealers. In addition, in certain states the shares may not be sold unless the
shares have been registered or qualified for sale in that state or an exemption
from registration or qualification is available and is complied with.
We may suspend the use of this prospectus if we learn of any event that
causes this prospectus to include an untrue statement of a material fact or omit
to state a material fact required to be stated in this prospectus or necessary
to make the statements in this prospectus not misleading in light of the
circumstances then existing. If this type of event occurs, a prospectus
supplement or post-effective amendment, if required, will be distributed to each
selling shareholder.
The shares offered under this prospectus were originally issued to former
shareholders of ASIC International, Inc. in connection with the acquisition of
this company pursuant to exemptions from the registration requirements of the
Securities Act provided by Section 4(2) thereof and/or Regulation D under the
Securities Act. In connection with this acquisition, we agreed to register the
ordinary shares offered under this prospectus under the Securities Act.
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LEGAL MATTERS
The validity of the securities offered hereby has been passed upon for us
by Allen & Gledhill, Singapore.
EXPERTS
Our consolidated financial statements and schedules appearing in our
Current Report (Form 8-K) filed with the SEC on January 29, 2001 incorporated by
reference in this registration statement have been audited by Arthur Andersen
LLP, independent public accountants, as set forth in their reports. In those
reports, that firm states that with respect to certain subsidiaries its opinion
is based on the reports of other independent public accountants, namely Deloitte
& Touche LLP. The consolidated financial statements and supporting schedules
referred to above have been incorporated by reference herein in reliance upon
the authority of Arthur Andersen LLP as experts in giving said reports.
The consolidated financial statements and schedules of The DII Group, Inc.
as of January 2, 2000 and January 3, 1999 and for each of the 3 years in the
period ended January 2, 2000, incorporated by reference in the Current Report on
Form 8-K of Flextronics International Ltd. filed on January 29, 2001,
incorporated by reference in this registration statement, have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their reports, and are
incorporated herein by reference in reliance upon the reports of such firm given
upon their authority as experts in accounting and auditing.
With respect to the unaudited interim financial information for the
quarters ended December 31, 1999 and 2000, Arthur Andersen LLP has applied
limited procedures in accordance with professional standards for a review of
that information. However, their separate report thereon states that they did
not audit and they do not express an opinion on that interim financial
information. Accordingly, the degree of reliance on their report on that
information should be restricted in light of the limited nature of the review
procedures applied. In addition, the accountants are not subject to the
liability provisions of Section 11 of the Securities Act of 1933 for their
report on the unaudited interim financial information because that report is not
a "report" or a "part" of the registration statement prepared or certified by
the accountants within the meanings of Sections 7 and 11 of the Securities Act.
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PROSPECTUS
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May 18, 2001