SANTA ANA, Calif. (AFX) - Computer memory maker SimpleTech Inc. said Wednesday it sold its consumer division for $43 million.
The transaction included the assumption of $13.6 million in liabilities. The divestiture should be neutral to earnings, the company said.
The company, which will rename itself STEC, said the SimpleTech name will stay with the consumer division.
President, Co-Founder and Director Mike Moshayedi, who has been in charge of the consumer division, will no longer be a STEC officer or employee, and resigned from the company's board.
Replacing him on the board will be Vahid Manian, senior vice president of global manufacturing operations for Broadcom Corp.
STEC said it also reached a revenue agreement with one of its original equipment manufacturer division's customers. The agreement will result in lower revenue and higher gross profit margin percentage but will have no effect on gross profit dollars or earnings per share, the company said.
STEC shares fell 26 cents, or 2.7 percent, to close at $9.35 on the Nasdaq. The stock has ranged between $3.25 and $13.27 over the past year.
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