ST. PETERSBURG, FLA. -- Jabil Circuit Inc. will buy Nypro Inc. for $665 million -- a major strategic acquisition that gives the $17 billion contract manufacturer a new market of packaging and beefs up its molding for medical disposable goods and consumer electronics.

In slam-bang fashion, Jabil, which is publicly traded on the New York Stock Exchange, issued an announcement of the deal at the start of Feb. 4, followed by a conference call to analysts later that same morning. Nypro did not immediately issue its own news release.

Global consolidation in key industries helped spark the deal, officials said.

The deal is expected to close in Jabil's fiscal third quarter, which ends in May. It is subject to a vote by participants in Nypro's Employee Stock Ownership Plan (ESOP) and other shareholders, and it must pass antitrust review in the United States, China and other countries.

Nypro is one of the world's largest custom injection molders, with more than $1 billion in sales from molding, tooling product design and contract manufacturing. Nypro employs about 12,000 people in 10 countries. The plastics company is tiny compared to Jabil, which employs 141,000 and is a leading maker of mobile phones and other electronic products. But Jabil executives, in the conference call, called Nypro a major acquisition and heaped praise on the company.

"It gives us immediate credibility in key markets" of packaging and single-use medical products, said Timothy Main, chairman and CEO of Jabil, based in St. Petersburg, Fla.

Courtney Ryan, Jabil's senior vice president of global business units, will be the lead executive at Nypro. He said Jabil provides electronics hardware to major medical customers, and those customers want to deal with full-service suppliers. "It creates a really, really unique market space for us," Ryan said.

Nypro President and CEO Ted Lapres said the new ownership will help Nypro grow. "It's a great strategic fit from our side, and we just think it's going to be spectacular for our employees and our customers," he said on the conference call.

Lapres said Nypro and Jabil have similar corporate cultures and commitment to growth and innovation.

Founded as Nylon Products Corp. in 1955, Nypro grew steadily to become one of the marquee U.S. custom injection molders. Gordon Lankton, who bought into the company in 1962, led Nypro through a series of moves that included a massive renovation of an old carpet mill into a headquarters in Clinton, Mass. and expansion around the world. In 1998 Lankton sold most of his stock to the ESOP.

Lankton is chairman of Nypro today.

Lapres said that ESOP ownership structure limited Nypro's ability to grow, as its global sectors experienced consolidation.

"We do have a very unique company culture and a very proud, long tradition of employee ownership, and our chairman is a legend in the plastics industry," Lapres told financial analysts. "But it became clear to myself, our management team and our board over the last couple of years that the competitive landscape was changing and that size mattered in this industry, and that our customers were demanding more. ... And paradoxically, the success of our employee ownership structure put us in position where we didn't have the full funding and resources to fund all the great opportunities we have in these markets."

Lankton endorsed the deal in a news release. "I have always believed in growing our business in order to create meaningful opportunities for our employees. Our partnership with Jabil does just that, and I am confident they are an ideal partner for Nypro," he said.

Lankton is a member of the Plastics Hall of Fame and the Manufacturing Hall of Fame.

This is not the first time that Nypro and Jabil have linked up on an acquisition. However the last time, in 2001, the buyer was Nypro.

In that deal, Nypro bought two injection molding plants in China from Jabil, including a plant in Danshui and the molding portion of an operation in Panyu. The deal included 80 injection presses with clamping forces up to 250 tons.

The operations boosted Nypro's already considerable stake in China. At the time it had molding and assembly plants in Shenzhen and Tianjin and a mold-making plant in Hong Kong.

Jabil had owned the plants since September 1999 when it purchased them from GET Manufacturing Inc. of Mountain View, Calif.

Nypro continued to supply Jabil from the purchased plants.

Last year Nypro ranked No. 7 in Plastics News' survey of North American injection molders with $644 million in relevant sales, and $1.204 billion in total corporate sales.