World News
11/01/1999
Worldwide highlights
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Semi book-to-bill drops to 1.08
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Orders and shipment of semiconductor equipment from North America producers stayed almost the same in September, with a preliminary book-to-bill ratio of 1.08, according to the Semi trade association. Bookings in the month totaled $1.48 billion, down slightly from a revised $1.54 billion in August (see table). Shipments totaled $1.37 billion, a bit lower than August's revised $1.41 billion, the trade association said. All figures are three-month moving averages.
Chip sales rise in August. Sales of semiconductors saw another round of substantial month-to-month and year-to-year gains in August, climbing to $11.96 billion in the month, said the SIA and World Semiconductor Trade Statistics Organization in the latest Global Sales Report. Despite the glowing figures, some analysts called for a pause in capital spending in the second half of 1999 as chipmakers are bringing up 0.18µm processes before beginning the next round of buys.
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The August sales figure is 3.5% above July's revised sales of $11.56 billion, and marks a 21.7% jump over year-ago sales of $9.82 billion. While the sales figure has been generally moving upward, the growth has been spotty and marked by several dips in the month-to-month trend line. August, however, marks the third straight month of improving numbers, and SIA president George Scalise said the "acceleration in growth is another strong indicator that the industry is sustaining the upturn that started in mid-1998."
As was the case in July, all regions showed solid month-to-month gains (see table). Europe reported in with the strongest growth, at 3.9%. All figures are three-month rolling averages. On a year-to-year basis, Japan and Asia Pacific were particularly strong, showing upward changes of 31.7% and 30.1%, respectively.
Japan
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In a move to strengthen its role in the Japanese market, Asyst Technologies, Fremont, CA, is acquiring a minority share of atmospheric robotics supplier MECS Corp., Nagoya, Japan, and plans to take a majority stake in the company within six months.
As part of the transaction, the two firms will partner on joint product development, marketing, and support for Asyst's installed tool base in Japan. The alliance is expected to play a key role in bringing Asyst's new front-end automation outsourcing push to the Japanese market. The partnership also will give Asyst a stronger manufacturing and engineering presence in the country. Also as a result of the new alliance, Asyst said it will wind down its distributorship with Innotech Corp.
Asyst's initial stake in MECS will be less than 20%, said Doug McCutcheon, Asyst CFO. In the next three to six months, MECS will reorganize its operations, shifting current emphasis from the FPD/LCD sectors over to semiconductors. The reorganization will include a spin off of some smaller equipment programs for medical and university uses. Once the reorganization is completed, likely in about three to six months, Asyst will in-crease its share in MECS to 60%, said McCutcheon.
Tokyo Electron Ltd. has secured a patent license from implant tool supplier Varian Semiconductor Equipment Associates (VSEA), Gloucester, MA, paying $25 million in initial royalties.
Details about the agreement between the firms have not been disclosed. VSEA VP Ralph Knupp declined to comment on which patents VSEA is licensing, noting that the two firms have agreed not to disclose specifics about the license. In a joint announcement, VSEA and TEL said the patents in question involve temperature control of wafers. Under the agreement, TEL will make the initial $25 million payment to VSEA and has agreed to pay future royalties based on "sales of equipment incorporating the licensed technology." The initial payment includes payments for past royalties and some future royalties.
Knupp indicated that the license agreement resolves patent issues that arose as the two firms phased out their joint venture company, TEL-Varian Ltd., over the past several years. The joint venture company was primarily responsible for manufacturing or customizing VSEA (then doing business as the semiconductor equipment business of Varian Associates) tooling in Japan.
USA
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Backed by a license from Los Alamos National Laboratory, GT Equipment Technologies (GTi) is gearing up to bring a new photoresist removal method to market, and says it may be interested in sublicensing the technology to other toolmakers. The Nashua, NH-based company recently beat out about 20 other suppliers in a bidding process with Los Alamos National Laboratory, Los Alamos, NM. Working in conjunction with Hewlett-Packard Co., the Lab has developed a system, dubbed Supercritical CO2 Resist Remover (SCORR), that uses CO2-based supercritical fluids to remove hard-baked photoresists. Heiko Moritz, GTi sales manager for systems equipment, said the system has the potential to integrate today's plasma ash, solvent clean, and rinse and dry steps into a single chamber. "Our technology — the CO2 technology — for stripping photoresists will have the ability to take the whole chain ... and it's possible to do what we call dry-to-dry strip with just one machine." In addition, Moritz noted, a closed-loop CO2 process offers significant environmental benefits, not the least of which are low water consumption and wastewater generation.
Applied Materials has finalized its acquisition of web CMP tool developer Obsidian, Fremont, CA, in a stock swap deal worth about $163 million at recent share prices. Under terms of the transaction, holders of Obsidian common stock, preferred stock, options and warrants will receive, in the aggregate, approximately 1.9 million shares of Applied's common stock. Applied first announced plans to acquire Obsidian in May, and was one of several toolmakers reportedly in the bidding for the startup.
Planar Systems Inc., Beaverton, OR, said it will reduce operating expenses by cutting 18 jobs and selling off a subsidiary. In conjunction with the headcount reduction, Planar has instituted a hiring freeze on all open positions. The company plans to sell Planar Flat Candle Inc., a wholly owned subsidiary that manufactures and sells backlights for liquid crystal displays. The restructuring is expected to save the company approximately $2.5 million annually.
For an undisclosed sum, SanDisk aquired the patent portfolio of Invox Technology, Campbell, CA. Included in the portfolio are 19 US patents issued or allowed, and another 28 pending patent applications, most of them in the area of flash memory storage.
Responding to industry demand, component supplier IBM Technology Group, Somers, NY, will increase its production of active matrix liquid crystal displays by 50% starting in April 2000. IBM's joint venture with Toshiba, Display Technology Inc., located in Western Japan, will initiate a 50% production increase in high-resolution 14-, 15-, 18-, and 20-in. displays used for notebook PCs, desktop monitors, and LCD desktop monitors, and manufactured for both OEM customers and IBM ThinkPads. IBM recently developed the first high-resolution (120 pixels/in.) SXGA+ panels for notebooks and monitors.
Asia/Pacific
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Taiwan-based UMC Group announced the installation of the first pieces of production equipment at its new 8-in. wafer fab, Fab 8F (formerly UMC Fab 5). This marks completion of cleanroom construction at the fab, located in the Hsinchu Science-based Industrial Park.
With the absorption of LG Group's chip operations, Hyundai Electronic Industries Co. (HEI) of South Korea became the world's largest DRAM producer, with a world market share of a 20%, compared to 18.5% for Samsung Electronics of Korea and 11.7% for Micron Technology of the US.
This year IDG estimates HEI's market share will reach 20.8%, while analysts expect both Samsung and Micron Technology of the US to reach 20% shares, as some DRAM vendors, particularly in Japan, back out of what has been a money-losing venture for the past couple of years.
As expected, Taiwan Semiconductor Manufacturing Co. said its net sales in September were down 10% as a result of the earthquake that hit the island in September. Sales totaled NT$6.1 million in the month. But despite the month-to-month loss, TSMC's sales figures are still up 37.9% on a year-over-year basis. Year-to-date sales reached NT$49.4 million.