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We propose a new BDD-based method for decomposition of multi-output incompletely specified logic functions into netlists of two-input logic gates. The algorithm uses the internal don't-cares during the decomposition to produce compact well-balanced netlists with short delay. The resulting netlists are provably nonredundant and facilitate test pattern generation. Experimental results over MCNC benchmarks show that our approach outperforms SIS and other BDD-based decomposition methods in terms of area and delay of the resulting circuits with comparable CPU time.