Kontron AG and Ennoconn Corporation have agreed to enter into a strategic partnership in the Communication segment. This partnership will be put into effect via Ennoconn taking a 49% stake in Kontron Canada Inc. (KCI) at a price of USD 57.3 million (approximately EUR 52.5 million), to be paid to Kontron AG. Kontron AG will retain the remaining 51% of KCI.

This transaction will be subject to regulatory and corporate approvals, which are expected to be granted during early 2016. By taking this step with Ennoconn, a subsidiary of Foxconn and one of the largest hardware manufacturers globally, Kontron moves into an excellent strategic position to take advantage of a rapidly changing technological world, determined primarily by the brisk development of the Internet of Things. Moreover, Ennoconn will provide production and supply chain efficiencies tailored to the market, and ODM capabilities to rapidly bring standard or customized hardware building blocks to production.

Kontron brings application-specific solutions built on expertise in firmware, system management, virtualization, and integration of these with the hardware. Matched with Kontron's market and application know-how as well as its customer relationships, the cooperation with Ennoconn will accelerate development and deployment of application-specific solutions. Kontron already subcontracts about 10% of its board-production to Ennoconn, a level of collaboration which will widen and deepen as a result of the partnership: closer cooperation is also envisaged in the context of the two companies' R&D, procurement, production and global logistics activities, as well as brand distribution, marketing and channel development efforts with a major focus on China.

Kontron also plans to leverage Ennoconn's significant competitive advantages in terms of time-to-market, cost efficiency and product quality.