NOTE makes acquisition for growth in the UK

NOTE makes acquisition for growth in the UK

NOTE has signed an agreement to acquire the operations of UK EMS company
Proqual.

Over the past two years, NOTE has worked extensively on developing a unique
business model called Nearsourcing. The business model is intended to increase
growth and profitability while simultaneously reducing the risks of its
operations. Nearsourcing is based on volume production in cost-efficient
countries, implementing the NOTEfied preferred parts database as a support to
sourcing and development processes, and cost-efficient development work close to
the customer, cutting their time to market.

Last autumn, NOTE expanded its production capacity in cost-efficient countries
through the start-up of new joint venture plants in China and Poland, which
created the prospects for cutting its costs in high-cost countries
significantly. One consequence of this process was that NOTE issued redundancy
notices to 124 employees in Sweden last week. Market reaction to the launch of
the NOTEfied preferred parts database has also exceeded expectations.

NOTE's profitability has performed strongly in recent years, primarily a result
of cost rationalisations. Now, NOTE's focus has moved to increasing growth, and
accordingly, the acquisition of the operations of Proqual is a natural step to
increase sales. 

Commenting, Knut Pogost, NOTE's Chief Strategic Officer, said: “Proqual is a
technologically skilled and flexible EMS (electronics manufacturing services)
company located in Gloucestershire, near Bristol. Operations are focused on
services early in product life-cycles like prototyping and sophisticated
electronics production in shorter runs. Annualised sales are some SEK 45m and
the company has 40 employees. We will now add further skills to this business
and create our first Nearsourcing operation in the UK. Thus the customer base
the company has accumulated offers major potential for future growth on the UK
market.”

“The appointment of our new Board of Directors last spring meant work on
developing our unique business model intensified,” added Arne Forslund, NOTE's
CEO and President, “this acquisition is intended to increase our growth and is
fully consistent with the previous start-up of our Nearsourcing operation NOTE
Oslo. We expect the new UK company to make a positive contribution to our
margins as early as the current year.”

“The trend towards increased outsourcing of electronics production is strong and
we expect it to offer healthy growth opportunities. Now, as planned, we are
scaling up our offensive on new geographical markets which will contribute to
further growth for NOTE in the long term.”

For more information, please contact: 
Arne Forslund, CEO & President, tel. +46 (0)8 568 990 07, +46 (0)70 547 74 77
Henrik Nygren, CFO, tel. +46 (0)8 568 990 03, +46 (0)70 977 06 86
Knut Pogost, Chief Strategic Officer, tel. +46 (0)8 568 990 06, +46 (0)70 552 34
44

About NOTE 
“Our business concept is to produce electronics from design to after-market
close to our customers.”
NOTE is one of the Nordic region's leading contract manufacturers of electronics
and is established in Sweden, Finland, Norway, the UK, Estonia, Lithuania,
Poland and China. Net sales for 2006 totalled SEK 1,742 m, and the NOTE group
has approximately 1,200 employees. Read more at: www.note.se