Teradyne Agrees to Acquire Assets of E-M-Solutions; Purchase Expected to Extend Vertical Integration Advantage in Electronic Manufacturing Services

BOSTON--(BUSINESS WIRE)--Aug. 2, 2001--Teradyne, Inc. (NYSE: TER) today announced an agreement to acquire a substantial majority of the domestic assets of E-M-Solutions and the stock of its foreign subsidiaries. In conjunction with the agreement, E-M-Solutions today voluntarily petitioned for reorganization under Chapter 11 of the U.S. Bankruptcy Code. Terms of the proposed transaction call for a purchase price of up to $85 million, and completion requires approval of the bankruptcy court. The transaction is expected to become accretive in 2002, adding over $200 million of revenue. The acquisition of the E-M-Solutions assets will expand the capabilities of Teradyne's Connection Systems (TCS) division based in Nashua, New Hampshire.

E-M-Solutions, based in Fremont, California is a leading electronic enclosure manufacturer that provides value-added system assembly and electro-mechanical integration services. Its customers are major original equipment manufacturers (OEMs) in the computing, data networking, communications and data storage markets.

"This acquisition will strengthen TCS's position as an electronic systems integration partner with our customers," said Rick Schneider, Teradyne Connection Systems President. "E-M-Solutions' capabilities, including metal fabrication expertise, integration facilities and skilled employees, will enhance TCS's ability to offer vertically integrated electronic manufacturing solutions. When the combination of TCS and E-M-Solutions is complete, TCS will be better positioned to provide complete solutions for our customers' complex electronic packaging needs."

Under the terms of the deal, Teradyne will acquire certain assets and businesses of E-M-Solutions located in the United States and the stock of its foreign subsidiaries. The subsidiaries located in Lisburn, Northern Ireland and Guadalajara, Mexico are not part of the bankruptcy filing.

The transaction is subject to bankruptcy court approval and customary regulatory review and is expected to close in the fourth quarter of 2001.

About Teradyne Inc.

Teradyne (NYSE: TER) is the world's largest supplier of automatic test equipment and is also a leading supplier of high performance interconnection products and total systems integration services. Teradyne's automatic test products are used by manufacturers of semiconductors, circuit assemblies and voice and broadband telephone networks. Teradyne's high-technology components and electronic manufacturing services are used by manufacturers of communications and computing systems central to building networking infrastructure. The company had sales of $3 billion in 2000 and currently employs about 9000 people worldwide. For more information visit www.Teradyne.com.

About Teradyne Connection Systems Division

Teradyne Connection Systems (TCS), a division of Teradyne, Inc., provides total system solutions to industry leading OEMs with laminate and printed circuit board manufacturing, high-speed, high-density connectors, multi-gigabit backplanes and electronic manufacturing services. TCS employs more than 3,000 worldwide.

About E-M-Solutions

E-M-Solutions (Electro Mechanical Solutions) is an internationally recognized, electronic enclosure manufacturer that provides value-added system assembly, integration services and world-class supply chain management solutions to Fortune 500 original equipment manufacturing (OEM) companies. A privately held corporation, E-M-Solutions is based in Fremont, California and has seven manufacturing and design facilities worldwide. For more information, visit www.e-m-solutions.com

Safe Harbor Statement

This release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations or beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The forward-looking statements in this release address the following subjects: expected date of closing the transaction; future financial and operating results; and timing and benefits of the transaction. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: uncertainties associated with economic conditions in the electronics and test industries, particularly in the principal industry sectors served by the combined company, changes in customer requirements and in the volume of sales to principal customers, the ability of the combined company to achieve the anticipated benefits and synergies associated with this transaction, the challenges and risks associated with managing and operating business in numerous international locales, competition and technological change, the risks that the businesses will not be integrated successfully, the inability to close the transaction due to closing conditions in the definitive agreement, the failure to close due to the failure to obtain court approval, and the inability to obtain or meet conditions imposed for governmental approvals for the transaction. For a detailed discussion of these and other factors, please refer to Teradyne's filings with the Securities and Exchange Commission, especially the factors set forth in Teradyne's fiscal 2000 Annual Report on Form 10-K and Teradyne's most recent quarterly 10-Q Report.

“E-M-Solutions' capabilities, including metal fabrication expertise, integration facilities and skilled employees, will enhance TCS's ability to offer vertically integrated electronic manufacturing solutions. When the combination of TCS and E-M-Solutions is complete, TCS will be better positioned to provide complete solutions for our customers' complex electronic packaging needs.”