updated 7/11/2005 4:52:27 PM ET 2005-07-11T20:52:27

Telephone headset manufacturer Plantronics Inc. said Monday it agreed to acquire Altec Lansing Technologies Inc., a maker of portable and powered audio systems, for about $166 million in cash.

"The combination of our expertise in voice communication and Altec Lansing's in music entertainment enables us to meet the full audio needs of the consumer, in their personal and professional lives," said Ken Kannappan, president and CEO of Plantronics.

Altec Lansing will remain in Milford, Pennsylvania, functioning as a division of Plantronics. Gary Savadove, former GE Consumer Electronics executive and CEO of Labtec, joined Plantronics six months ago and is president and CEO of the Plantronics Audio Entertainment Business Group which will now incorporate Altec Lansing.

Bob Garthwaite, who has served as senior vice president of marketing and sales for Altec Lansing, will become president and CEO of Altec Lansing after closing of the agreement.

Altec Lansing, which posted more than $100 million in revenue in calendar 2004, brings to Plantronics a range of products such as the inMotion portable speaker systems. In addition, Altec Lansing offers computer and home entertainment sound systems and a line of headphones and headsets.

Plantronics said it expects that excluding acquisition-related charges, the deal will boost earnings in fiscal 2006. Including items, the transaction isn't expected to materially impact 2006 results, but will add to earnings in fiscal 2007.

Plantronics, which has about 3,900 employees, reported earnings of $97.5 million on sales of $560 million in fiscal 2005.

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