Jan. 29, 2003 — FEI Co., a Hillsboro, Ore., provider of nanoscale metrology and fabrication tools, reported a fourth quarter loss of $3.5 million, or 11 cents per share, versus earnings of 24 cents per share for the fourth quarter of 2001.
Fourth quarter revenues were $85.2 million, versus $96.6 million from the year earlier period. Earlier this month, FEI and Veeco Instruments terminated a merger agreement. FEI’s stock, which trades on Nasdaq, closed up 4 cents at $16.48.
Jan. 28, 2003 – Leuven, Belgium – IMEC’s board of directors has announced the construction of a new 300mm cleanroom.
Construction of the new 2,200 square meter research fab will begin in February, with completion expected in approximately 18 months. The facility is expected to go on-line in mid 2005, with activities gradually ramping up.
The initiative involves an investment of 84 million euro ($91.2 million) of which 37.2 million euro has been granted by local government.
The new fab will be located adjacent to IMEC’s existing facilities to ensure and optimize the exchange of information and to share common facilities, infrastructure, and metrology tools.
IMEC will set up several research programs targeting the issues identified by the International Technology Roadmap for Semiconductors for the sub-45nm node. The focus will be on EUV lithography, new materials, advanced devices, and innovative interconnect schemes. The programs will be open for semiconductor companies and material and equipment suppliers worldwide.
Jan. 24, 2003 — Ardesta LLC, an Ann Arbor, Mich., small tech investment firm and company builder, has invested in San Francisco-based Angstrovision Inc., according to a news release. The amount of the investment is not being released, an Ardesta spokeswoman said.
Angstrovision is developing a nano-imaging device for characterization and metrology that creates 3D images with resolutions of several nanometers, the release said. The company plans to ship its first product in 2004. Ardesta is the parent company of Small Times Media.
Jan. 17, 2003 — Two small tech equipment makers had hoped that by merging they could offer researchers a package of tools. But as Veeco Instruments and FEI Co. blamed last week’s breakup on bad economic timing, one nanotech analyst said such a marriage just wasn’t meant to be.
“I think the tool market is going to fragment; there won’t be a one-size-fits-all approach to tools,” said Neil Gordon, a partner with Montreal-based Sygertech.
“There are so many needs, and so many disciplines. … I don’t see nanotech as having a PC tool set where everyone will have a nanobox on their desk to analyze materials — not in our lifetime.”
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Veeco and FEI first announced the $1 billion deal in July, and it had been set to take effect at the end of 2002. But in December, with regulatory and shareholder approvals still pending, both firms announced the merger would not meet the year-end deadline. Based on combined 2001 sales of $825 million, the two companies together would have constituted the sixth largest U.S. semiconductor equipment company and the third largest U.S. supplier of metrology equipment.
Both companies offer metrology equipment for measurement and imaging, but each focuses on different areas. Veeco specializes in atomic force microscopes for submicron surface profiling. FEI makes ion and electron beam tools for failure analysis, fab production process control and other tasks.
Still, the small tech market they aimed to serve jointly remains part of each company’s business plan.
“The more products you have to sell, the better. Both companies have noncompetitive scientific research products, but it’s just not the right time (to merge),” said Debra Wasser, Veeco’s vice president of investor relations and corporate communications.
“Each company is a significant player in nanotech and the small tech area. … We’ll continue to go down our separate paths, looking for growth in those markets.”
FEI said it will continue to develop nanotech tools, including three-dimensional metrology devices for nanofabrication. Officials have said those efforts have helped the company grow in good economic times and stay afloat in bad.
“Just because the merger didn’t happen doesn’t mean that certain collaborations aren’t possible — or similar collaborations or marketing agreements with other companies,” said Jay Lindquist, FEI’s senior vice president of corporate marketing.
“We’re very actively looking for other partners out there. We seek some kind of business relationship where we can grow our business in nanotech.”
Gordon said that regardless of future mergers or acquisitions, there are plenty of toolmakers to serve current small tech needs.
He cited an industry report released last year that identified more than 125 companies worldwide making software, visualization, production and other equipment for the MEMS and nanotech markets. He said the number might even be as high 350, when the smallest and most secretive firms are counted.
A great majority of the firms are small and focused on a particular niche, capitalizing on technology spun out of an academic or government lab. He believes that’s key to understanding the future direction of small tech.
As the markets mature, he said, the need increases for specialty tools. Some companies, such as NanoOpto Corp. and Zyvex Corp., are developing tools for their own needs. Other startups are tapping research centers, which typically have unused capacity and seek customers.
“There will always be a need for these mainstream products; Veeco and FEI’s sales will increase over time,” he said. “But because the market is growing and moving in different directions, there’s room for these startups.”
Lindquist agreed that most companies are not in the business of providing “a one-off kind of tool.” But that hasn’t stopped FEI from taking on customers who came with a tool developed in-house and wanted a toolmaker to license the technology and turn it into a workable, marketable product.
For example, FEI worked with the University of Maastricht in the Netherlands to develop the Vitrobot, an automated tool for preparing biological samples in a frozen state for imaging by a transmission electron microscope.
“Many smaller organizations can develop a single tool, but once tools get to the point where there’s a broader market for them or many need to made … they go to someone who can that technology and turn it into a tool,” he said.
“To me, it’s all part of the evolution of developing tools and capabilities for new market. Over time it’s going to coalesce. It has to, to be able to deliver real products and solutions that are reliable, manufacturable, and that you can count on being here a year from now.”
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Jan. 13, 2003 — A small Madison, Wis., company is gearing up to become a big supplier of microscopic components for nanotech research and design.
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Formerly known as Piezomax, nPoint Inc. produces nanopositioning components and systems used in atomic force microscopes (AFMs) and scanning electron microscopes (SEMs) for nanotech research and manufacturing.
The company was founded in 1997 by nanoscale instrumentation specialist Max Lagally of the University of Wisconsin, and for the past year has been shipping products that help researchers manipulate particles at submolecular levels of up to one-tenth of a nanometer.
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That is a greater level of precision than most manufacturers and research institutions are working with today, according to nPoint’s chief executive, John Biondi. He estimates the market for nanopositioning in microscopy and CD metrology at $74 million per year, with an additional $35-million-per-year market in semiconductor chip lithography. Demand in all three markets is growing at nearly 50 percent per year, he added, with newer markets in nanotechnology for life sciences and defense holding additional promise.
“Companies are building proteins by depositing one tiny layer of biomaterial on any of a number of spots on a biochip,” Biondi said. “The devices available right now to do that are at a much coarser level than what is needed.” Defense applications include nanopositioning guidance systems for unmanned drone aircraft used in war zones such as Afghanistan.
The company’s primary competitors include Physik Instrumente of Germany and Queensgate Instruments of Great Britain.
Being in the United States offers nPoint some key advantages, Biondi said. “Fifty percent of the semiconductor OEM market is here, so being close to that market helps. Being in the U.S. is good for our defense applications as well,” he said. A recent item in the Forbes/Wolfe Nanotech Report called nPoint a “company to watch.” Peter Hebert, managing partner at Lux Capital, agreed with that assessment. “They are approaching with the razor blade rather than the razor model,” Hebert said. “nPoint sees that that one component is increasing in value — its value may jump from 8 percent to 12 percent of the cost of the microscope.”
Original nPoint funding came via nine Small Business Innovation Research grants totaling $3 million. This past summer the company secured an additional $1.15 million from four Wisconsin angel investor groups, and is raising more capital to boost production.
“The company already had key customers, including top-notch research institutions and major manufacturing companies,” said Adam Bock, research director at the angel investor resource Early Stage Research LLC. “The competitive environment was attractive due to a limited number of competitors. Most major competitors are outside the U.S., but 50 percent of the target market is in the U.S. We expect the target market to grow 45 to 50 percent per year, with additional opportunities in new and developing markets as nanopositioning becomes more critical in more technology areas.”
Revenues in the company’s first full year in production — 2001 — were $250,000. Biondi said 2002 sales should top $2.5 million.
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Company file: Iolon Inc.
(last updated Jan. 13, 2003)
Company
nPoint Inc.
Headquarters
1617 Sherman Ave.
Madison, Wis., 53704
History
Max LaGally of the University of Wisconsin founded nPoint (as Piezomax) as an outgrowth of his work in thin film materials science and microscopy. The company, incorporated in 1997, has been named a “company to watch” in the Forbes/Wolfe Nanotech Report. Piezomax officially became nPoint in June 2002.
Industry
Nanopositioning instrumentation
Employees
14
Small tech-related products and services
nPoint develops nanopositioning and controlling components. These components, often used in nanotech tools such as atomic force and scanning electron microscopes (AFMs and SEMs), help researchers and manufacturers manipulate particles as small as 1/10 of a nanometer. Currently, nPoint is focusing on OEM sales while it develops a method for retrofitting older AFMs and SEMs.
Management
Investment history
Initially, nPoint was funded by a set of nine Small Business Innovation Research grants (totaling $3 million). This was followed by a Wisconsin Technology Development Loan of $125,000. Nearly $1.2 million more came in during summer 2002, contributed by Wisconsin-based angel investors. The company hopes to raise another $3 million in venture financing.
Revenues
Selected customers
Barriers to market
German competitor Physik Instrumente holds 75 percent of the nanopositioning device market. However, nPoint believes that its U.S. location, as well as its products’ enhanced resolution and response, will be beneficial in the large domestic market.
Competitors
Goals
“Being the best custom OEM design house in the world for nanopositioners and ultraprecision motion control devices; passing sustainability in the second year of product shipments (2003),” says CEO John Biondi.
Why they’re in small tech
“We are a technology that enables the building, manipulation and measurement of small (nano) structures,” Biondi says. “We bridge the macro with the nanoworld.”
What keeps them up at night
“Worrying about things getting bigger.”
Recent articles
nPoint founder receives Tibbetts Award
nPoint expands line of nano tools
nPoint nets angel funding
Relevant patents
Method for sharpening nanotube bundles
Method and apparatus for improved control of piezoelectric positioners
Contact
–Research by Gretchen McNeely
Jan. 10, 2003 — Veeco Instruments and FEI Co. said Thursday they won’t merge as planned, citing continued poor economic and market conditions.
The makers of metrology equipment and other technology for the small tech and semiconductor industries first announced the $1 billion deal in July, set to take effect at the end of 2002. But in December, with regulatory and shareholder approvals still pending, both firms announced the merger would not meet the year-end deadline.
Dec. 31 also marked the end of the penalty phase of the merger agreement, during which a company that wanted out of the deal would have to pay the other a $30 million breakup fee. As a result, neither Veeco nor FEI will pay any termination fees.
A Veeco official said it was the right deal at the wrong time.
“From the industry’s and our companies’ perspectives, the economy as a whole was expected to turn around,” said Debra Wasser, Veeco’s vice president of investor relations and corporate communications. “At this point, it was time to rethink the transaction. For Veeco, the fastest path for earnings growth is alone.”
Based on combined 2001 sales of $825 million, the two companies together would have constituted the sixth largest U.S. semiconductor equipment company and the third largest U.S. supplier of metrology equipment.
Both firms’ stocks, which trade on Nasdaq, closed higher Thursday. Veeco was at $14.47, up from $12.34 on Wednesday; FEI was at $18.75, up from $16.25.
Jan. 9, 2003 – Woodbury, NY and Hillsboro, OR – Veeco Instruments Inc. and FEI Co. have mutually terminated the merger agreement that they entered into on July 11, 2002.
Veeco and FEI have determined not to proceed with the merger due to the difficult overall market and economic conditions, and the uncertain timing of an industry recovery. Neither party will pay the other any termination fees or expenses.
Veeco is a worldwide provider of metrology tools and process equipment for the semiconductor, data storage, telecommunications/wireless, and scientific research markets. Its manufacturing and engineering facilities are located in New York, California, Colorado, Arizona, and Minnesota.
FEI is a supplier of structural process management solutions to semiconductor, data storage, structural biology, and industrial companies. Headquartered in Hillsboro, OR, FEI has additional development and manufacturing operations located in Peabody, MA; Sunnyvale, CA; Eindhoven, Netherlands; and Brno, Czech Republic.
Dec. 18, 2002 — Veeco Instruments Inc. and FEI Co. said they won’t merge as planned by year’s end, citing delays in obtaining regulatory and shareholder approvals.
Debra Wasser, Veeco’s vice president of investor relations and corporate communications, said the merger has yet to be cleared by the U.S. Department of Justice, the Securities and Exchange Commission and approved by the companies’ shareholders. The primary cause of the delay has been a second request for information from the Justice Department, though she declined to offer details.
“By last week, it became a technical impossibility to get this done by the end of the year,” she said. “We didn’t expect this to happen, but those things can never be taken for granted.”
The firms said they are discussing changes to the deal they announced in July, which called for them to merge by Dec. 31 and for FEI to become a wholly owned subsidiary of Veeco. The companies could not say when or whether those regulatory approvals will be met or if they ultimately will agree to merge.
Dec. 31 marks the end of the penalty phase of the merger agreement, during which a company that wanted out of the deal would have to pay the other a $30 million breakup fee. Among the changes under consideration by the firms is whether to extend that penalty phase.
She said both companies have started working on integration planning. “Strategically, our product lines are very complementary and there are all these great reasons to do this merger.”
Based on combined 2001 sales of $825 million, the two companies together would constitute the sixth largest U.S. semiconductor equipment company and the third largest U.S. supplier of metrology equipment. Both firms make microscopy tools and other technology for the small tech industry.
Nov. 6, 2002 – Milpitas, CA – Nanometrics Inc., which supplies the semiconductor industry with integrated and standalone metrology tools, has announced the introduction of its newest metrology system, designed to control the copper CMP process.
The Nano CLP-9010 copper laser profiler non-destructively monitors the metal loss between an isolated copper feature and the surrounding dielectric region. The small footprint measurement module is a high-throughput, small-spot-size laser profiler that can be easily integrated within a metal CMP system. Unlike reflectance-only methods, the laser profiling technology is immune to previous level patterning noise that can cause unreliable end-pointing of the polishing process.
Integration of the Nano CLP-9010 gives users control over the copper CMP process because it ensures that the process can be continuously monitored, improving both the wafer yield and cost efficiency. Specifically, the module’s laser profiler provides IC manufacturers with a substantially more stable copper process because it performs monitoring of every wafer at all metal layers. In contrast, chipmakers have traditionally used standalone, offline metrology tools that are slower and have an increased risk of wafer damage and contamination.
The non-contact laser profiler performs quick, precise and direct measurements across the surface of the wafer to determine the amount of copper loss. The laser profiling technology improves the stability of the copper process by monitoring metal loss on the wafer, allowing the process engineer to minimize the degradation of global planarity on the wafer.
Measuring planarity is particularly important to control of the copper CMP process because the metal polishes faster than the dielectric. Excessive metal loss from over-polishing can ultimately result in a reduction in the depth of field of the lithographic process, while under-polishing can increase the probability of shorts in the metal layers.
In addition, Nanometrics’ laser profiler technology can predict the minimum copper thickness on the largest copper features and allow direct calculation of copper thickness. The laser profiling technology underwent beta testing with a leading DRAM manufacturer in 2001. The testing demonstrated the capability of the new technology to meet the production monitoring requirements of copper CMP processes.
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Oct. 8, 2002 — When Veeco was founded in 1945 by a pair of Manhattan Project researchers who invented a helium leak detector, the company’s name was an acronym for Vacuum Electronic Equipment Company.
Today, the name of the Woodbury, N.Y.-based Veeco might stand for Very Enormous Electronics Company. With $450 million in sales (2001), Veeco provides a wide array of process equipment and metrology tools to assist in the manufacturing, measuring and testing of microelectronic components.
In recent years, Veeco has grown by leaps and bounds as a result of strategic acquisitions. Its most recent merger with FEI Co. will make it the sixth largest semiconductor equipment company and the third largest metrology equipment company in the United States.
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Before 1997, Veeco was primarily a process equipment company, supplying ion beam etch and ion beam deposition for the data storage industry and other industrial customers. Five years ago Veeco expanded into metrology when it acquired Wyko, a manufacturer of optical metrology tools.
Since then, Veeco’s acquisitions have revealed a strategic move toward nanotechnology and MEMS. Most notable are Veeco’s purchases of three companies that manufacture atomic force microscopes (AFMs) and a number of key process equipment suppliers for the semiconductor industry that enable nanocoatings and MEMS device manufacturing.
Atomic force microscopes are a key tool for researchers in the fields of bioscience, life science and materials science. They play a fundamental role in nanotechnology processes, and Veeco earns nearly a third of its revenues from AFM sales and support, making it the market leader in nanocharacterization.
Veeco purchased the AFM divisions or AFM-related intellectual property from Digital Instruments in 1998, from IBM in 2000, and from Thermo Microscopes in 2001.
“Veeco is now the market leader in scanning probe microscopes,” said Ramon Compano, who has been witnessing a consolidation in the market since taking the helm of the European Commission’s nanoelectronics project management office.
Veeco has indeed “cornered the market” said Risto Puhakka of VLSI Research Inc. AFM use in the semiconductor industry is expected to grow, and Veeco intends to capitalize on this trend by providing the kind of support that other AFM suppliers couldn’t.
“Earlier vendors did not have the worldwide customer support necessary,” said Veeco spokesperson Fran Brennen. “Both our semiconductor and nanotechnology customers, depending on what part of the globe they are, require 24/7 sales and support often not available from smaller AFM suppliers.”
Chip manufactures use AFMs to analyze the surface of wafers to make sure they’re defect free before going to the next step in the production process. The market opportunity is driven by productivity improvement demands in semiconductor automation applications, which use the AFM for surface profiling and defect management, and is projected to grow from $181 million to $800 million in 2007.
According to Puhakka, using AFMs and related tools in a preventative measure is a major trend driven by the need to reduce waste, cut costs and improve quality all the way along the line. The AFM is expected to become increasingly important as a key tool for those who are exploiting nanotechnology.
An AFM enables researchers and engineers to not only observe but also manipulate matter at the nanoscale. John Roy, an analyst for Merrill Lynch & Co. Inc., said atomic force microscopes are “the foundation for doing any type of manipulation.” He said Veeco hopes to change the perception of AFMs from that of “tools to test silicon fabrication systems,” to “part of the actual silicon fabrication process. So, instead of etching into the wafer using x-rays or whatever, you will now use atomic force microscopes to align the atoms as you please.”
Since cornering the market in AFMs, Veeco has set its sites on nanomanipulation tools. This year, it announced a merger with FEI, the Hillsboro, Ore., based manufacturer of process management systems that incorporate ion and electron beams to scan submicron structures. With FEI under its belt, the Veeco sales team can now offer researchers an entire package of tools, such as those used to do nanomanipulation.
Veeco isn’t touting its focus on nanotech, preferring to describe its acquisition strategy as a way to “add enabling technologies in core target markets,” such as semiconductor, data storage and telecommunications, said Brennen. However, according to the Veeco spokesperson, “Veeco and FEI both recognize a sizeable growth opportunity to be a key supplier for nanotechnology researchers. Both companies have had a long-term commitment to nanotechnology.”
One reason why Veeco isn’t waving a nanotech banner above its corporate headquarters may be that it doesn’t want to be seen as ignoring near-term opportunities in favor of chasing after long-term possibilities. The “story is already complicated enough without confusing Wall Street with talk of nanotechnology,” said Debra Wasser, vice president of investor relations for Veeco, adding that “the Street tends to see nanotechnology as a future market.”
(Small Times Correspondent Valerie Thompson contributed to this report.)