World News
06/01/1999
Worldwide highlights
Sematech may merge with Int`l arm.
After more than a year of operating two separate Sematechs, one international and one for US members only, directors of the chip manufacturing consortiums are considering a merger plan that would create a single global organization. Such a merger would bring together 15 IC companies from the US, Europe, Taiwan, and South Korea with deep ties in precompetitive research projects, 300mm tool evaluation, and other areas of semiconductor manufacturing development. The firms are already cooperating in the International 300mm Initiative, which dates to 1995, and in International Sematech, which began work in April, 1998, and incorporates I300I as a division.
SEMI`s book-to-bill hits 1.30. North American semiconductor tool suppliers saw order rates climb to $1.15 billion in March, marking a 14% improvement from February and the sixth straight month of strengthening orders, according to the latest figures from the Semi trade association. Orders were up 2% over year-ago levels. Shipments totaled $887 million, resulting in a book-to-bill ratio of 1.30. While the March shipment figures are better than February`s revised shipments of $835.1 million, they are down from year-ago levels by 35%. All figures are three-month moving averages.
New cap spending reports. Two new capital spending forecasts call for chipmakers to spend roughly $27 billion in 1999. In a recent Global Semiconductor Monthly report, Morgan Stanley Dean Witter estimated capital spending will total $26.5 billion worldwide, down from $29.1 billion in 1998 and a peak of $42.6 billion in 1996. IC Insights, Scottsdale, AZ, expects spending to total $26.8 billion, down from $27.0 billion last year and $43.1 billion in 1996. Both reports say 1999 capital spending budget increases are likely as the market continues to improve.
Cleanroom market growth slows. Worldwide orders for semiconductor cleanrooms are forecasted to shrink to $571 million next year, down from $595 million in 1995, according to a new report from market researcher McIlvaine Company, Northbrook, IL. Overall, orders for cleanrooms (including those from the pharmaceutical, medical device, and automotive areas) are expected to see 8.5% average annual growth between 1995 and 2000, far below the double-digit annual growth seen by the cleanroom market for the past three decades. The semiconductor sector and the depressed Asian market are blamed for the slowdown.
USA
VLSI Technology, Sunnyvale, CA has agreed to be acquired by Royal Philips Electronics for $21/share; VS* has about 46.6 million shares outstanding. Earlier this year, in an unsolicited tender offer, Philips moved to acquire VLSI for $17/share, but VLSI rejected the deal.
Brooks Automation,, Chelmsford, MA, has acquired Hanyon Technology, a decade-old South Korean supplier of MES and automation software, and system integration services. The value of the cash deal was not disclosed. Hanyon had calendar 1998 revenues of $6 million. Separately, Brooks and Samsung Electronics are establishing a joint venture in Korea to manufacture vacuum wafer handling platforms and 300mm FOUP load port modules. The JV will also design, manufacture, and configure atmospheric loading systems for FPDs. Brooks will own 70% of the venture, Samsung 30%.
Asyst Technologies, Fremont, CA, will acquire privately-held Progressive System Technologies (PST), a nine-year old substrate handling and automation company with fingers in both the open cassette and SMIF sectors. The deal is valued at about $10 million at recent share prices, and was expected to close possibly by the end of May. With PST, Austin, TX, Asyst will enter the open-cassette market and strengthen its position in the emerging reticle automation sector.
Maskmaker Photronics Inc. has purchased Cirrus Logic`s mask engineering department, and will use it as the foundation of a new business unit known as Design-to-Wafer Services, or D2W. The unit will provide a broad range of mask and circuit design services, and will also be able to handle technical issues related to data handling, design optimization, and preparation for manufacturing. Cirrus will be one of the new firm`s early customers, but will hold no equity in D2W or Photronics.
Texas Instruments, Dallas, TX, has raised its 1999 capital spending plan 30% to $1.3 billion, up from $1.0 billion, and has increased its R&D spending expectations to $1.2 billion from $1.1 billion. The chipmaker said the budget increases come in response to continued improvement in the large end-equipment markets.
Cypress Semiconductor said it will increase manufacturing capacity by 25% and headcount to over 300 at its 6-in. fab in Round Rock, TX, after idling 30% of the facility last year. Cypress is also increasing production by 10% at its 200mm Fab IV facility in Bloomington, MN, where it is ramping 0.25?m SRAM production. The production increase will be followed by another 10-15% production ramp later this year. Cypress plans to equip the facility with new Endura PVD and MxP+ Centura oxide etch systems from Applied Materials. The systems are scheduled to ship in 2Q and 3Q of this year.
A $700 million expansion of the Lucent Technologies-Cirrus Logic Cirent joint venture wafer fab near Orlando, FL, could begin by the end of the year. While no firm roadmap for the project has been set, it will likely involve installation of an equipment set for 0.16?m production under Lucent`s COM-2 process with additional phases to follow. In addition, Lucent is expanding its Bell Labs development group`s fabrication facility at the Cirent site; work at the new 27,000 sq. ft. R&D unit includes low-k dielectrics and copper metallization.
CVC, Rochester, NY, has acquired ion beam firm Commonwealth Scientific Corp., Alexandria, VA. The combined PVD-ion beam company is ex pected to have annual sales of more than $100 million, and about 460 employees. Both CVC and Commonwealth Scientific are privately held companies; terms of the deal were not disclosed. In addition, CVC has sold its fluid products business to Inland Vacuum, Churchville, NY, and its gauges and tubes business to Myers Vacuum Repair Services, Kittanning, PA.
Applied Materials has purchased high-density plasma CVD (HDP-CVD) intellectual property, inventory, and assets from Watkins-Johnson Co.`s Semiconductor Equipment Group, adding to its portfolio of CVD know-how. The deal follows W-J`s decision to sell most of its equipment group, including the atmospheric pressure CVD line, to Silicon Valley Group. In addition, Applied has received an order for multiple SACVD systems from Samsung Electronics.
Applied Science and Technology, Woburn, MA, has acquired Klee Corp., Peabody, MA, in a deal worth an estimated $4.5 million at recent ASTeX share prices. ASTeX exchanged 310,604 of its shares to acquire the firm, which makes a PVD tool for the flip-chip packaging sector.
SpeedFam International, Chandler, AZ, and Integrated Processing Equipment Corp., San Jose, CA, have won shareholder approval of the plan to merge, a deal valued at roughly $157 million. Under the terms of the merger agreement, SpeedFam was expected to issue 13,046,791 shares of its stock, with each outstanding share of IPEC stock being exchanged for 0.71 shares of SpeedFam common stock.
Spin-processing tool supplier SEZ Group, Phoenix, AZ, has set a joint development alliance with EKC Technology, Hayward, CA, to supply complete polymer removal solutions to customers using the SEZ 4200 spin processor and EKC640, an advanced polymer removal chemistry. SEZ has also received a multimillion dollar order from Taiwan`s Nanya Technology Corp. Nanya will use the SEZ tooling for backside and frontside wafer surface conditioning.
Fairchild Corp., the parent company of Fairchild Technologies Semiconductor Equipment Group, is contemplating a possible sale or merger of the wafer track and spin-on equipment unit. The parent company has been planning a spin-off of the equipment unit since late 1997, and is undergoing a restructuring to focus on its aerospace-related fasteners business.
Praxair, Danbury, CT, and German wet chemical firm Merck KGaA Electronic Chemicals said they will combine efforts in a semiconductor gases, chemicals, systems, and services alliance. The two companies plan to pool their respective sales and product lines in the alliance.
Arch Chemicals (formerly Olin Specialty Chemicals), Norwalk, CT, has signed up for a marketing alliance with gas and chemical management firm Air Liquide. The two firms will collaborate by promoting each other`s complementary services as a comprehensive solution to chipmakers` needs.
American Xtal Technology, Fremont, CA, has begun producing silicon carbide (SiC) crystals, and hopes to begin generating revenue from SiC substrate sales by the end of the year. The company will also shift its slicing, grinding, and polishing operations to a new facility in Beijing, China this summer.
FSI International, Minneapolis, said it will supply Lam Research with P2200 slurry blending and distribution systems. Separately, FSI has received a $4 million order from Motorola`s Semiconductor Products Sector for chemical delivery equipment, control monitoring systems, and startup services. The chemical delivery systems will be installed in 2H of FY99.
Advanced Silicon Materials, Moses Lake, WA, is building a new $7.5 million monosilane gas bulk-loading facility at its year-old polysilicon plant in Butte, MT. The new silane facility will have approximately 200 metric tons of annual capacity, doubling the company`s total bulk loading capacity; it will be operational in 1Q00.
Flip Chip Technologies (FCT), Phoenix, AZ, has licensed its flip chip bumping technology to Advanced Semiconductor Engineering (ASE), Kaohsiung, Malaysia. The licensing agreement marks the first such license for FCT`s flip chip technology and is the first step in a strategic business alliance between the two companies. ASE will use FCT`s technology with its flip chip BGA packages.
Lambda Physik, Ft. Lauderdale, FL, has received multiple orders for high performance excimer laser systems from Silicon Valley Group`s lithography division. The order is for Lambda`s next generation NovaLine excimer lasers operating at 2 kHz pulse rate. Delivery is scheduled for 2Q99.
Japan
Fujitsu Ltd. and Hitachi Ltd. are expected to begin operations of a new plasma display panel (PDP) joint venture in July, one year after the two firms signed a PDP joint development agreement. The 50-50 joint venture, based in Kawasaki City, Kanagawa Prefecture, will develop, manufacture, and market large-screen PDPs.
Yamaha, Hamamatsu, Japan, will close its most advanced wafer fab by next February. Yamaha`s Tenryu Semiconductor Plant was completed in June 1998, and started wafer processing with a capacity of 7000, 200mm wafers/month at 0.25?m design rules. In a first phase of the fab project, the company spent some ?20 billion (about $166 million) for the new plant construction and equipment purchases. Yamaha said it cannot afford to continue making investments, as it does not anticipate increased demand for its audio devices. The firm is seeking a buyer for the plant, and will outsource its advanced manufacturing to foundries.
Matsushita Electric Industrial Co. will end production of DRAMs for PCs at its Tonami Prefecture fab in Japan, but will continue to make DRAMs for system LSIs and digital consumer electronics. The Tonami facility will not close as a result of the decision.
Wright, Williams & Kelly, Pleasanton, CA, has sold licenses for its Factory Commander cost and resource evaluation software to Selete, Japan`s 300mm research group. The software will be installed at Selete`s headquarters in Yokohama, Japan, for use in evaluating the projected costs and revenues of operating a 300mm fab.
Asia/Pacific
Nippon Steel Corp., a one-third partner in the Hitachi Nippon Steel Semiconductor Singapore (HNS) joint venture with Hitachi and the Economic Development Board of Singapore (EDB), is withdrawing from the operation, allowing Hitachi management to take over. NSC will no longer have representation on the joint venture`s board. As a result of the changes, Hitachi said it will move ahead with early introduction of 256Mbit DRAMs at HNS.
Malaysia`s 1st Silicon Sdn Bhd, which began efforts to establish a foundry in Kuching, Sarawak last year, has obtained a loan agreement for more than $200 million from Germany`s Ausfuhrkredit-GmbH export credit organization. The foundry has also secured a 0.25?m technology transfer/wafer supply agreement with Japan`s Sharp Corp. The deal with Sharp includes a joint R&D effort that will result in qualification and refinement of 0.18?m processes. A significant portion of 1st Silicon`s output will be absorbed by Sharp.
Europe
Excimer laser supplier Cymer, San Diego, CA, has opened a new regional field service office in Scotland to provide direct support to UK-based customers. The facility, which will house field service engineers and management, also serves as an extension of Cymer`s European headquarters in The Netherlands.
Carl Zeiss, Oberkochen, Germany, is leading the new German Initiative for 157nm Lithography. In a first phase of the project, which is funded by the German Ministry of Research and Education, the Initiative will develop 157nm photomask and optic materials, lens design concepts, and optical technologies. Tool and process development will follow. Production of the first devices using 157nm lithography is targeted for the end of 2003. Project partners include Schott ML, Lambda Physik, Infineon Technologies AG, Jenoptik AG, and ASM Lithography.
Silicon-on-insulator wafer manufacturer SOITEC has opened a new $50 million SOI wafer production plant in Bernin, France. The facility has an annual production capacity of 200,000 wafers, with the ability to ramp to 700,000 wafers/year in the future.
Trikon Technologies, Newport, Wales, has received orders from TriQuint Semiconductor for its MORI etch and Sigma PVD equipment. This is TriQuint`s first order for Trikon`s PVD tool; the chipmaker will use the system to deposit a three layer metal stack structure.
Gas management firm MKS Instruments, Andover, MA, has gone public with a $91 miillion offering of its stock. As part of the IPO, MKS is offering 6 miillion shares at $14/share, with selling shareholders offering an additional 500,000 shares. Final proceeds to the company are expected to total $77.5 miillion; an estimated $40 miillion will be distributed to shareholders as part of the company`s transition from an S corporation to a C corporation. Remaining proceeds may be used for acquisitions of complementary businesses, products, or technologies.
Microelectronic Packaging Inc., San Diego, CA, has reached settlement agreements with creditors holding more than $30 miillion in debt. The creditors have signed preliminary agreements to convert all of MPI`s obligations into about 9.4 miillion shares of MPI 3 1/2 % convertible preferred stock, which is convertible on a two-for-one basis into MPI common stock. Definitive agreements with the creditors still must be secured. MPI has been restructuring its debt since 1997, when the firm began liquidating its MPM Singapore subsidiary.
SubMicron Systems Corp., Allentown, PA, has retained investment banker Needham and Company to explore strategic alternatives for the company, including options for restructuring its balance sheet. The company said its level of debt is severely limiting its access to working capital, and indicated that it cannot support the debt going forward.
WORLD WIDE WEB BRIEFS
Picopolish, Rousset, France, a supplier of reclaimed GaAs and silicon wafers, has a web site at www.picopolish.com. The site provides a company profile, corporate and financial information, technical and quality policies, and a link to the Cezanne web site. Picopolish`s plant is located in the Aix en Provence area made famous in paintings by Cezanne.
Oxford Plasma Technology has launched a web site at www.oxfordplasma.com. The site includes information about the company`s plasma and ion beam equipment, market applications, contact information, press releases, and job vacancies.
Zellweger Analytics, Lincolnshire, IL, has restructured its web site, and now offers online applications information, its Y2K compatibility status and data about its product offerings, including its toxic, corrosive and flammable gas detection equipment and water/wastewater analysis equipment. The site can be accessed at www.zelana.com.