Rapac Electronics continued to speed upwards on Sunday trading, at a certain point shooting up over 15% on unusually heavy turnover of NIS million. Can we call this behavior strange? Mysterious? The explanation is simple: the company announced that it, and its subsidiary Racom Electronics had signed a memorandum of understanding with Arrow Electronics of the United States to set up a joint company in Israel.
Arrow will hold 51 percent of the company while Racom will control 49 percent, Rapac said in a statement to the Tel Aviv Stock Exchange.
The joint company will acquire from Rapac and Racom distribution and marketing rights as well as property and inventory. Arrow will pay for the rights as well as for goodwill a sum to be fixed according to the financial results of these activities in the 1998-2001 period.
Rapac Electronics markets electronic components, systems, inspection equipment and tools. Industrial activity is carried out by subsidiary companies Orpac and Transway.
Racom specializes in industrial process requirements, test and measuring equipment and environmental systems as well as coordinating the marketing activities for smart cards in Israel.
Headquartered in Melville, New York, Arrow is the world's largest distributor of electronic components and computer products with 1998 sales of $8.3 billion.
Rapac dropped 3.94% at the close of Monday trading on the TASE.
Published by Israel's Business Arena on January 17, 2000.