MAINBOARD-LISTED MFS Technology yesterday said that it has entered into a tie-up with Japan-listed SIIX Corp that is expected to generate about $100 million worth of business in financial year 2005.

MFS, through a wholly-owned subsidiary, has signed a memorandum of understanding with SIIX to build a strategic alliance.

The two companies have also agreed to try and buy up to $3 million worth of shares in each other's companies on the open market over the next three months.

MFS manufactures flexible printed circuits (FPCs) and printed circuit boards at its facilities in Singapore and Malaysia. Its new FPC factory in China is expected to commence operations this month.

SIIX is an electronics manufacturing services (EMS) firm with electronic design and fabrication capabilities. Its products include video and audio equipment, semi-conductor elements, integrated circuits and wire harnesses.

As part of the strategic alliance, SIIX will direct all its requirements and enquiries for FPCs to MFS for quotation and supply.

The two companies plan to strike up an agency agreement for MFS to supply FPCs to the Japanese market through SIIX, as well as SIIX's customers at its overseas operations.

MFS's managing director, Mr Pang Tak Lim, said in a statement: 'SIIX is already a major FPC user in its electronic manufacturing services in multiple markets, and the collaboration would expand the customer base of MFS into the Japanese market as well.'

According to a survey, the global market for FPCs is worth about US$5.1 billion (S$8.5 billion), with the Japanese market alone accounting for about a 58.5 per cent share.

Mr Pang said that MFS directors believed the alliance would enable the company to take advantage of SIIX's design capability, as well as its distribution and logistics services in Japan.