Benzinga | Aug 11, 2021 04:06PM EDT

EMCORE Corporation Announces Equipment Sale And Manufacturing Agreements Entered Into With Hytera In October 2019 Has Reached Mutually Agreed Termination By Both Parties

* As part of the agreement, Fastrain purchased and has paid EMCORE an additional $1.4 million of equipment not covered under the original agreement with Hytera

* Agreement represents a key milestone in the transition of EMCORE's operations from in-house manufacturing in Beijing to an Electronic Manufacturing Services (EMS) model

ALHAMBRA, CA, Aug. 11, 2021 (GLOBE NEWSWIRE) -- EMCORE Corporation (NASDAQ:EMKR), a leading provider of advanced mixed-signal products that serve the aerospace & defense and broadband communications markets, announced today that the equipment sale and manufacturing agreements entered into with Hytera in October 2019 has reached mutually agreed termination by both parties and EMCORE entered into further agreements with Shenzhen Fastrain Technology Co., Ltd. and Hong Kong Fastrain Company Limited (collectively, "Fastrain"), with the term of the new manufacturing agreement with Fastrain extended to December 31, 2025.

In 2019, EMCORE announced the sale of its Cable TV (CATV) production equipment and transfer of its CATV manufacturing operations from the Company's Beijing facility to Hytera Communications (Hong Kong) Company Limited and Shenzhen Hytera Communications Co., Ltd. (collectively, "Hytera"). The sale price for the equipment was approximately $5.5 million and Hytera used the equipment to manufacture CATV components and subsystems from its facility in Southeast Asia.

With the execution of these new agreements and transfer of production ownership from Hytera to Fastrain, EMCORE will achieve a key milestone in furthering a transition of its CATV business to a variable cost, electronics manufacturing services (EMS) model. The agreement with Fastrain includes the sale of further EMCORE production equipment for approximately $1.4M, and in addition it will create positive value to both companies while addressing present external global risks and opportunities. These operational changes in CATV will fulfill the objective of enabling the product lines to move forward servicing the market needs with a full portfolio of transmitter and laser offerings.

"Our 2019 agreement with Hytera has played an integral role in the transition to a fully EMS-based model for our Cable TV products. We are very appreciative that Hytera has been with us during this transformation," said Iain Black, Senior Vice President of Operations at EMCORE. "We are extremely pleased to take this new step with Fastrain and are looking forward to many years of success together, with continuing improvements in operational efficiencies and capabilities over the coming quarters," added Mr. Black.