Multi-Fineline Electronix, Inc. (MFLX) Shares Jump 40% on Acquisition Deal

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Shareholders of Multi-Fineline Electronix, Inc. (NASDAQ:MFLX) are quite pleased today after it has been announced that the company has entered into a definitive merger agreement that will allow another company called DSBJ to acquire them for approximately $610 million. The deal has sent the stock up close to 40% in pre-market trading this morning.

The acquistion price represents a 40.8% increase over yesterday’s closing price, and the deal has been unanimously approved by the Board of Directors at both companies.

“This transaction is a continuation of our growth and diversification strategy, and represents a new milestone in DSBJ’s 35-year business history,” explained Yuan Yonggang, Chairman and President of DSBJ. “The outstanding management team and employees of MFLEX have built a global leader in flexible printed circuit design and manufacturing with a marquee customer list. Working together, we believe we can expand MFLEX’s brand and leadership in the mobility space, while accelerating market opportunities in the automotive, industrial, display and other fast-growing consumer segments. There are meaningful sales synergies we expect to realize through this acquisition given our complementary customer, product and manufacturing footprints.”

The stock decreased 3.41% or $0.58 during the last trading session, hitting $16.43. Approximately 1,000 shares traded hands. MFLX shares have declined 25.32% since July 1, 2015 and are currently downtrending. It has underperformed the S&P500 by 18.02%.

From a total of 2 analysts covering Multi-Fineline (NASDAQ:MFLX) stock, 1 rate it a “Buy”, 0 a “Sell”, and 1 a “Hold”. This means that 50% of the ratings are positive. The highest target price is $27 while the lowest target price is $13. The mean of all analyst targets is $20 which is 21.73% above today’s ($16.43) stock price. Multi-Fineline was the topic of 2 analyst reports since August 6, 2015 according to the firm StockzIntelligence Inc. Needham maintained shares on August 6 with a “Buy” rating.

The institutional sentiment decreased to 1.02 in Q2 2015. It’s down 1.56, from 2.58 in 2015Q2. The ratio dived, as 14 funds sold all their Multi-Fineline Electronix, Inc. shares they owned while 32 reduced their positions. 9 funds bought stakes while 38 increased their total positions. Institutions now own 7.98 million shares which is 1.83% more than the previous share count of 7.84 million in 2015Q2.

Harvest Capital Strategies Llc holds 0.3% of its total portfolio in Multi-Fineline Electronix, Inc., equating to 100,000 shares. Malaga Cove Capital Llc owns 18,440 shares representing 0.24% of their total US portfolio. Moreover, Bryn Mawr Capital Management Inc has 0.12% of their total portfolio invested in the company, equating to 40,273 shares. The United Kingdom-based Gsa Capital Partners Llp has a total of 0.11% of their portfolio invested in the stock. Ancora Advisors Llc, a Us-based fund reported 47,261 shares owned.

Multi-Fineline Electronix, Inc. is a producer of flexible printed circuits and flexible circuit assemblies. The company has a market cap of $414.96 million. With facilities in Irvine, California; Suzhou, China; Korea; Taiwan, and Singapore, the Company offers a global service and support base for the sale, design and manufacture of flexible interconnect solutions. It has 8.12 P/E ratio. The Firm is a global well-known provider of flexible printed circuits and value-added component assembly solutions to the electronics industry.

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