Eltek Signs Memorandum of Understanding to Acquire German PCB Manufacturer

Feb 19, 2002, 00:00 ET from Eltek Ltd.

    PETACH-TIKVA, Israel, Feb. 19 /PRNewswire-FirstCall/ --
 Eltek Ltd. (Nasdaq:   ELTK), the leading Israeli manufacturer of advanced
 circuitry solutions, today announced that it has signed a memorandum of
 understanding to purchase 76% of a privately held German PCB manufacturer for
 approximately $2 million.  Eltek anticipates closing the purchase within
 75 days.
     The Company specializes in short run and prototype boards, including
 multi-layer, flex-rigid and high density interconnect (HDI).  Its customers
 include companies engaged in telecommunications, defense, aerospace and
 industrial measurement equipment.  Current employees will remain with the
 Company following the acquisition.
     Commenting on the agreement, Arieh Reichart, President and CEO of Eltek
 said, "We are acquiring a well-established Company in the specialty PCB
 market, with a solid reputation in the German market and a loyal customer
 base.  The Company has a strong sales and marketing staff that will be focused
 on significantly enhancing business activities in Germany and Israel. This
 provides Eltek with instant and substantial inroads into the German market,
 while complimenting its existing relationships throughout the rest of Europe.
 This potential acquisition will provide Eltek with extremely capable
 employees, as well as additional sales and marketing channels.  This new sales
 and marketing strength will prove vital to Eltek's prominence in the
 marketplace as we work to expand our presence in Germany, as well as continue
 our efforts to grow throughout Europe.
     "Given our recent efforts to improve efficiency at our main production
 facility in Israel, we are well equipped to handle a production increase.
 This potential acquisition furthers our efforts to establish Eltek as the
 standard for high-end printed circuit board technology," Mr. Reichart
     The Company noted that it would discuss this, as well as other recent
 developments when it reports its fourth quarter and year-end 2001 financial
 results on Thursday, February 21, 2002.
     About Eltek
     Eltek is one of Israel's leading manufacturers of printed circuit boards,
 the core circuitry of most electronic devices.  It specializes in the complex
 high-end of PCB manufacturing, i.e., HDI, multi-layered and flex-rigid boards.
 Eltek's technologically advanced circuitry solutions are used in today's
 increasingly sophisticated and compact electronic products.  The Company has
 invested heavily in upgrading its production facilities over the past five
     Certain matters discussed in this news release are forward-looking
 statements that involve a number of risks and uncertainties including, but not
 limited to statements regarding expected results in future quarters, risks in
 product and technology development and rapid technological change, product
 demand, the impact of competitive products and pricing, market acceptance, the
 sales cycle, changing economic conditions and other risk factors detailed in
 the Company's United States Securities and Exchange Commission filings.
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SOURCE Eltek Ltd.