By Jeff Dorsch, Contributing Editor

The used and refurbished semiconductor equipment market can be a hazardous business for buyers. The watchword always is: Caveat emptor – let the buyer beware.

There are many reputable companies in the used equipment business, of course. Intel, Texas Instruments, and other big chipmakers put their surplus production equipment on the market, typically on an “as-is” basis.

Some used-equipment vendors and brokers also offer their wares as they are, without any guarantees or warranties. The chip-making gear may be faulty; it could lack a software license from the original equipment manufacturer, which has occasionally been a legal issue.

Many purveyors of used equipment are also involved in refurbishing pre-owned equipment, and some even develop their own equipment, given their experience in buying, maintaining, updating, and selling equipment.

“It’s an interesting year. The industry has been very busy,” says Byron Exarcos, CEO of ClassOne Equipment, which is based in Atlanta and has operations around the world in key markets. “There definitely is a lack of supply, versus demand. It has driven pricing up.

”It’s become very difficult to find equipment, especially 200-millimeter equipment,” he adds. “There’s a very tight supply and high demand, which invariably increases prices.”

Dave Pawlak, ClassOne’s vice president of purchasing, says the supply-and-demand situation has lately improved. The market is seeing “a slowdown” after a torrid period of activity, he adds. “Tools are becoming available. We’re starting to see a turn. The prices are coming down,” Pawlak observes.

Driving the demand for 200mm tools are manufacturers of microelectromechanical system devices and sensors, according to Exarcos. Light-emitting diodes are typically manufactured on 150mm wafer fabrication lines.

“They may have been using 3-inch, 4-inch tools,” he says of these manufacturers. “Eight-inch tools – they’re the leading edge.”

While Intel and Samsung Electronics are fabricating their most advanced chips on 300mm fab lines, those integrated device manufacturers (both of who are in the foundry business) are “keeping their 200mm tools,” Exarcos says. “They’re getting busy with them.”

The ClassOne Group now has an operation in Kalispell, Montana, which was the home of Semitool, an equipment manufacturer acquired in 2009 by Applied Materials. ClassOne Technology, founded in 2013, makes new wet-chemical process tools, including electroplating systems, for companies making LEDs, MEMS, photonics, power devices, radio-frequency devices, and other components. These companies may turn out 5,000 to 10,000 wafer starts per month, according to Exarcos, not on the level of volume production for the big IDMs.

In February, ClassOne Technology announced the acquisition of two product lines, a spin-rinse-dryer and a spray solvent tool, from Microprocess Technologies. Those products became the company’s Trident SRD and Trident SST lines.

Exarcos concludes, “It is critical to work with the right company.”

The related field of spare parts for semiconductor equipment was rocked in the 1990s by the case of Semiconductor Spares, Inc., which conspired with insiders at Applied Materials, Lam Research, and Varian Associates (the semiconductor equipment business of which was bought by Applied in 2011) to steal drawings of parts, enabling SSI to undercut those vendors on pricing. David W. Biehl, the company’s owner and president, pleaded guilty to a variety of charges in the case and was sentenced in U.S. District Court to 31 months in prison and ordered to pay $100,000 in restitution.

Once more – Caveat emptor.