Flextronics Provides Business Update Following Nortel Announcement

Flextronics has provided a business update as a result of Nortel Networks Corporation's announced bankruptcy protection filing. The company said it will provide more specific financial details associated with this news on its previously scheduled third quarter earnings call Wednesday, January 28, 2009 at 2:00 pm PST.

According to Flextronics, it has been proactively engaged in executing a risk mitigation plan with respect to its relationship with Nortel for a period of several months. In December 2008, Flextronics engaged The Blackstone Group as its financial advisor to assist with evaluating the Nortel relationship and planning for any Nortel restructuring strategy. As part of its risk mitigation plan, Flextronics entered into an amendment to its relationship agreement with Nortel to address Flextronics's status as a strategic supplier.

"Flextronics has been working to reduce its exposure to Nortel for some time now. During our November 2008 Analyst and Investor Meeting, I discussed in detail that Flextronics has organizationally aligned its operating and capital resources in such a way to mitigate the impact of business changes of any one customer," said Mike McNamara, Flextronics CEO. "We believe that Flextronics's strategy of customer and market diversification will continue to allow us to be in a position to weather economic volatility. We will be addressing the specific financials related to the Nortel business on our upcoming earnings call, and I want to emphasize that one of our strengths has been and continues to be our ability to adjust to market and customer changes such as those we've realized today."

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