World News
10/01/1997
Worldwide highlights
North American tools sales up. In another indicator of good health for the semiconductor equipment market, Semi has reported that July saw a solid uptick in bookings at North American equipment companies, and a book-to-bill ratio of 1.13. Bookings were $1.65 billion in the month, within $50 million of the all-time record, posted in February 1996. This is up 12% from June levels, and up 66% over July 1996, a period when monthly bookings were sliding toward their October bottom. Shipments were up 6.3% month-to-month, at $1.46 billion. This represents an 11.2% rise over year-ago levels. Most of the new order strength came in the front-end sector, where bookings hit $1.28 billion, compared to $1.1 billion in June, and $814 million in July 1996.
Front-end processing equipment to see growth. The total worldwide market for front-end processing equipment will grow 8.2% in 1997, up from 7.0% forecast in January, according to The Information Network, Williamsburg, VA. Through April, front-end equipment is down only 3% from 1996. "We stated in January that the bottom of the downturn was made in 4Q96," noted president Robert Castellano. "Recovery is greater than anticipated, and thus we raised projections from 7.0% to 8.2%." Companies are pushing to 0.25-µm features sizes, so the next wave of buying will be technology-driven rather than capacity driven.
World chip sales flat. World semiconductor sales were flat month-to-month in June, coming in at $11.393 billion compared to $11.389 billion in May, according to the Semiconductor Industry Association's Global Sales Report (see table). A 5% surge in Japanese sales offset modest declines in other regions, particularly Asia/Pacific; sales in the Americas dipped 0.3% month-to-month to $3.83 billion. If the flatness shifts to softness in the second half, it could become a matter of concern for the manufacturing sector, which is still affected by overcapacity.
 |
USA
Lam Research has concluded its acquisition of OnTrak Systems, with OnTrak chairman and CEO Jim Bagley taking over as Lam CEO. OnTrak shareholders will receive 0.83 shares of Lam stock (trading at about $60) for each OnTrak share (or 0.83 of a warrant for each warrant). With about 6.1 million new shares of Lam stock being issued, the deal has a value of roughly $366 million. Lam's share price has risen from the mid-$30s range since the deal's announcement in March, when the rough value was $225 million.
In addition, Lam has received a $22 million order from Nan Ya Technology Corp., Taiwan, for several TCP 9100 oxide etchers and TCP 9400 polysilicon etchers configured on the multichamber Alliance platform. Lam has also received a $38 million order from Hyundai Electronics Industries, South Korea, for Lam's new TCP 9600PTX high-density metal etch systems, TCP 9400SE high-density polysilicon etch systems, and Rainbow 4520 oxide etch systems. They will be installed in Hyundai's Eugene, OR, fab.
Eaton Corp. has wrapped up its buyout of Fusion Systems Corp., after completing a $39/share cash tender offer for the Rockville, MD, photoresist removal and curing firm. The offer, which is being followed by the merger of Eaton's ETN Acquisition subsidiary and Fusion Systems, included 7,173,785 shares being tendered. Each Fusion share not acquired in the tender offer will be converted into the right to receive $39 in cash. The deal is initially worth $293 million. Fusion will retain its operations in Rockville, but will be counted as a unit of Eaton's Semiconductor Equipment Operations group, based in Beverly, MA.
ASM America and IPEC Precision, Bethel, CT, have separately announced recent shipments of 300-mm tools. ASM has delivered a 300-mm Epsilon epitaxial reactor ordered last year by a major silicon wafer manufacturer. During the quarter ending June 30, IPEC shipped three PWS-300 precision wafer shaping systems that utilize the company's patented Plasma Assisted Chemical Etching (PACE) process. The systems were shipped to customers in Germany, Japan, and the US.
The US Display Consortium (USDC), San Jose, CA, has awarded a number of contracts. FPD and automation equipment supplier Accudyne Corp., Palm Bay, FL, will develop a laser-based glass separation system. MRS Technology Inc., Chelmsford, MA, will develop an advanced large-area, high-throughput step-and-repeat imaging tool for FPD manufacturing.
Slurry manufacturer Moyco Technologies, Montgomeryville, PA, is planning to sell off certain assets of its CMP business under a proposed deal with Ashland Chemical Co., a unit of Ashland Inc. The two companies have signed a nonbinding letter of intent. The transaction will include a lump sum payment to Moyco, with an ongoing stream of revenues based on royalties. The proposed deal includes worldwide rights to Moyco's metal and oxide CMP slurry manufacturing processes, formulas, patent applications, and trade secrets.
Acuity Imaging, a Robotic Vision Systems Inc. company that supplies multipurpose 2-D machine vision systems has acquired Trigon Technologies Inc., Farmington Hills, MI. Trigon will be merged into Acuity's operations and will add PC-based coplanarity inspection for perimeter leaded devices to Acuity's semiconductor industry product offerings.
Companies equip White Oak Semiconductor's new 64-Mbit site in Richmond, VA. The benchmark facility is a joint venture between Siemens Semiconductor Group and Motorola Semiconductor Products Sector. Applied Materials Inc., Santa Clara, CA, is supplying $100 million worth of advanced manufacturing tools for wafer processing and metrology. Canon USA Inc., Lake Success, NY, will supply photolithography tools, steppers, scanners, and technical support for 0.25-µm design rule production. SpeedFam International Inc., Chandler, AZ, will supply its Auriga CMP system, to be used for both oxide and tungsten. GaSonics International Corp., San Jose, CA, will supply Performance Enhancement Platform photoresist removal systems. Air Products and Chemicals Inc., Lehigh Valley, PA, has entered into a long-term agreement to manage all the industrial gases and chemicals at White Oak's facility.
Motorola's Semiconductor Products Sector has decided to establish a centralized fab tool procurement group and approved supplier list, and reduce the purchasing authority given to product groups within the sector. The sector has also allied with SGS-Thomson Microelectronics to ensure that the two companies' contactless smartcard microcontroller products are compatible and interoperable. In addition, Motorola is working to establish better communication among its fabs, in an effort to squeeze more output from its existing facilities. The changes represent a cultural shift for Motorola, which had traditionally maintained decentralized authority within groups manufacturing different products, such as memories, microcontrollers, microprocessors, and RF devices.
Silicon Valley Group, San Jose, CA, has received an order for 25 of its Micrascan DUV step-and-scan lithography systems for a value of $129 million. The order includes several Micrascan III tools, Micrascan II+, and Micrascan QML (quarter micron lamp) systems. The tools, which are slated for delivery over the next two years, will be used for production on 200-mm wafers.
Zygo Corp., Middlefield, CT, has signed a letter of intent to acquire privately held Digital Instruments, Santa Barbara, CA, in a stock swap worth about $220 million at recent share prices. This is Zygo's third acquisition in a year. The move could result in a new generation of metrology tools combining atomic-force and laser-based technologies. The transaction, which is expected to close by the end of the calendar year, will result in Digital Instruments becoming a wholly owned subsidiary of Zygo.
CFM Technologies, West Chester, PA, is planning a 1998 move into a new 140,000-ft2 facility in Exton, PA, where it will establish new headquarters to house flat panel and semiconductor manufacturing space, and engineering, marketing, customer service, and administrative functions. The company plans to retain its current manufacturing facility in West Chester. In a separate announcement, CFM said it completed initial processing of 300-mm semiconductor wafers in its Full-Flow system, with results comparing "favorably" to 200-mm results.
Johnson Matthey Electronics (JME), Spokane, WA, a supplier of thin-film deposition materials, will supply Applied Materials Inc. Vectra IMP source titanium targets. This Vectra technology was developed by Applied to deposit critical liner and barrier films in high aspect ratio, sub-0.25-µm device structures. The targets incorporate JME's high-purity titanium diffusion bonding process and utilize TITAN high strength backing plates. JME also plans to locate a manufacturing facility in Taiwan's Hsinchu Science Park. The facility will provide physical vapor deposition and chemical vapor deposition sputtering products, thermocouple heat-sensing devices, and silicon seeds for silicon production.
MEGA Systems & Chemicals Inc., Chandler, AZ, a chemical blending and slurry company, has expanded with a new 22,000-ft2 facility in Tempe, AZ, for a total of 39,500 ft2 of space. The new building houses the components division and administrative space for field operations, project management, and finance. The company has already hired 45 new employees during its expansion. Part of MEGA's expansion includes agreements with RCi Inc. for representation on the East Coast, and with Summit Technologies for the Southern California region. These representatives will handle all phases of sales and support. In addition, MEGA Systems co-founders Robert Korman and Richard Roney have received the Arizona Entrepreneur of the Year Award.
Compound semiconductor materials supplier EMCORE Corp. is planning another expansion of its Somerset, NJ, facility, and expects to occupy the 72,000-ft2 building fully by the end of the year. The expansion is being driven in part by growth in the company's foundry and materials and devices businesses, according to CEO Reuben Richards. The company now occupies about 55,000 ft2 of the Somerset facility, and this latest expansion will increase the size of EMCORE's cleanroom, R&D, equipment manufacturing, foundry, office, and other operations, according to a company spokesman.
Under a joint development agreement, MEMC Electronic Materials Inc., St. Peters, MO, and Texas Instruments have opened a new 200-mm silicon wafer facility in Sherman, TX. The joint venture business, known as MEMC Southwest, is 80% owned by MEMC and 20% owned by TI, and will serve both TI and the open market. At initial full capacity, the Sherman facility will produce some 190,000 wafers/month. The company hopes to ramp to full production within the next 12 months.
SpeedFam International Inc., Chandler, AZ, has completed construction of its 136,000-ft2 corporate headquarters. The facility includes a world-class laboratory to support development work in CMP, semiconductor device cleaning, disk polishing, silicon wafer processing, and applied R&D. In addition, SpeedFam has received a follow-on order from Promos Technology Inc. for the Auriga planarization device.
PlasmaQuest Inc., Richardson, TX, has moved to a new Dallas, TX, location that consists of 29,000 ft2 of office, lab, manufacturing, and cleanroom space. The move will accommodate the growing demand for ECR-based etch and CVD systems for the magnetic head industry, compound semiconductor etching, low temperature CVD applications, and specialized high dielectric materials processing. PlasmaQuest's fifth generation lab/demo system for customer sample processing and R&D will be housed in the new location.
Image Technology Inc., Palo Alto, CA, has purchased the MICRONIC LRS 200 laser writing system to increase capacity and complement international growth. The system should be fully operational by December. Image is also expanding and upgrading its Class 1000 and Class 100 cleanroom facilities, and expanding its processing and inspection areas.
Astra Microtronics Technology (AMT), Pleasanton, CA, a maker of semiconductor assembly and test systems, has broken ground on its new manufacturing facility on Batam Island, Indonesia. The new construction will add 165,000-ft2 to the company's existing 230,000-ft2 facility. In addition, AMT has ordered 200 model 3006 W110 and W114 wire bonders, and 25 die attach systems from ESEC SA, Switzerland. The order is valued in excess of $24 million.
Kyocera America Inc., San Diego, CA, will spend $11 million over the next two years to upgrade its semiconductor packaging facility. The company will spend $6 million to purchase automated equipment and expand the ceramic package manufacturing line, doubling weekly output. Another $5 million will be used to expand nickel and gold plating operations, which includes adding a 3700-ft2 facility.
Tegal Corp., Petaluma, CA, has received repeat orders for its 6540 critical etch systems worth over $5 million from Samsung Electronics Co. Ltd. and Hyundai Electronic Industries Co. Ltd.
With plans to commercialize its aluminum vacuum technology, Argonne National Laboratory has established UHV Aluminum Co., Chicago, IL, a new firm aimed at producing aluminum ultra-high vacuum chambers for the semiconductor equipment industry. The 16-person operation, established by Argonne's ARCH Development Corp. arm, is working with cluster tool developers in its effort to develop economical aluminum vacuum applications in the thin-film deposition equipment, vacuum coating equipment, and analytical instrumentation arenas.
Photronics Inc. has announced plans to build a new photomask facility later this year in Oregon. Photronics expects to start construction on the new 52,000 ft2 photomask facility and development center this fall in Hillsboro's Oregon Technology Park. Completion is slated for next summer, and photomask production is expected to begin by the end of 1998. Once the facility is up and running, Photronics and photomask writing equipment manufacturer Etec Systems Inc. will begin work under a joint technology sharing agreement to develop new pattern generation technologies and advanced photomask production processes.
Hewlett-Packard (H-P) is planning to build a new 200-mm fab in Fort Collins, CO, as it shifts ASIC production away from its Corvallis, WA, site to make way for increased activity in its Ink Jet business. The project is estimated to have a cost in the hundreds of millions. The entire project will likely take two to three years, and the ASIC production, slated primarily for internal consumption, will be phased over from the Corvallis facility to the new fab. As part of the transition, H-P's Ink Jet Supplies Business Unit will acquire the Corvallis wafer fab in the next two to three years. The approximately 800 people based in the 150-mm Corvallis fab will be offered jobs in Fort Collins, or equivalent positions in Corvallis if they choose not to relocate.
Symbios Logic is planning to close its 150-mm CMOS fab in Fort Collins, CO, by year-end, and is hoping to find buyers for its used fab equipment. The company is working with other semiconductor firms to find jobs for some of the 239 employees affected by the plant closure. If a buyer is not found by the time the fab closes on December 31, the company will likely lease the facility out and sell the processing equipment, said a spokeswoman. The closure of the facility does not affect current probe, test, and packaging operations at the plant. Other departments, such as development, product design, and management, will also not be affected.
DuPont Photomasks Inc. (DPI), Round Rock, TX, is planning an investment of more than $18 million in capital equipment as part of a worldwide expansion plan. Under the expansion, DPI will install a CORE 2564 writing tool at a new production line in Ichon, Korea. DPI's Kokomo, IN, facility will see a new MEBES 4500 e-beam system and the Hamburg, Germany, facility will receive a CORE 2500 writing tool that was formally installed in Ichon.
Lithography developer Integrated Solutions Inc. (ISI), Austin, TX, is making progress on its search for a strategic partner, and hopes to have a deal in place soon. President Ellery Buchanan said ISI is successfully engaging several companies in discussions. Most have been with equipment suppliers. The company engaged Smith-Barney to seek out potential partners in July, at the same time as a modest layoff. ISI hopes to get an influx of marketing clout and capital, in an effort to provide better customer service, reduce risk, and improve shareholder value.
Japan
Foreign market share at all-time high. Increased foreign access to the Japanese market and an increase in the purchase of chips for computers, have pushed foreign market share in Japan to an all-time high of 32.6% during 1Q97, according to a Semiconductor Industry Association report. Since the new trade accord was approved between US and Japan, foreign market share in Japan has jumped 6.2 percentage points (see figure). Japanese consumers are buying more and more personal computers, benefiting US and other foreign chip makers.
 Foreign market share growth in Japan over five years. |
null
Nissan Chemical Industries Ltd., Tokyo, Japan, and Brewer Science Inc., Rolla, MO, have signed an agreement in which Brewer grants an exclusive license to Nissan to manufacture and sell ARC antireflective coatings for the Asian semiconductor industry. With the acceleration toward sub-0.35- and sub-0.25-µm technologies, the demand for ARC antireflective coatings has increased, especially in Japan, Taiwan, and Korea. Nissan has begun construction of a manufacturing facility at its Toyama plant. Commercial production will begin in early 1998.
CFM Technologies, West Chester, PA, is planning a strategic move into the Japanese flat panel display market. CFM is seeking a partner in Japan for its Full-Flow flat panel display wet processing systems. Chief financial officer Jeff Randall said that the sought partnership could range from an agent-type arrangement, similar to what the company now has established in Taiwan, to a joint venture agreement. Last year, about 20% of CFM's revenues came from sales to the FPD industry, with the remainder from the semiconductor industry. This year, the company expects that FPD industry sales could account for as much as 25% of revenues.
With an eye toward becoming one of the world's top three gallium arsenide (GaAs) wafer suppliers by the year 2000, Sumitomo Chemical, Tokyo, said it will begin manufacturing 100-mm GaAs wafers using MOCVD this month. Current estimates call for the company to produce 2000 wafers/month at start up, with plans to double production next spring. By 2000, the company expects it will have tripled its GaAs wafer production levels.
Japan has issued a patent on the basic Radiance Process and apparatus from Radiance Services Co., Bethesda, MD. The Radiance Process uses laser light and flowing inert gas to remove any contamination from surfaces and to produce changes in surface topography.
Asia/Pacific
Manufacturing execution systems software supplier Consilium Inc., Mountain View, CA, has purchased the major assets of systems integrator FAST Associates in southeast Asia, and plans to open a new operational unit in the region. The value of the deal was not disclosed, however, Consilium will offer employment to the approximately 30 FAST Associates employees, said Ed Norton, senior VP and president of the company's semiconductor and electronics business unit. As a result of the acquisition, Consilium will establish a new South Asia Region of its semiconductor and electronics group to cover Taiwan, Singapore, Malaysia, and Thailand.
Working with a joint venture partner and a line of investors, Global Semiconductor Technologies Inc. (GST), Phoenix, AZ, is planning to build a new 1000 metric ton polycrystalline silicon plant in China. GST chairman and CEO Don Jackson said GST will kick off the polysilicon plant project in October, with construction beginning sometime thereafter. The new facility is expected to begin operations in 2001. Jackson said the company, working with joint venture partner Yunnan General Electronics Industry Corp. in China, is in the process of acquiring another site between 20 and 60 acres, available in Kunming City in Yunnan Province.
Europe
Philips Electronics, The Netherlands, has joined Japan-based Sony and Sharp as members of the Plasma Addressed Liquid Crystal Display (PALC) development project. Under the joint project, Philips, Sharp, and Sony, which has a PALC manufacturing line in Mizunami, Gifu Prefecture, will develop 40-in. PALCs with 853 × 480 pixels by this fall. In about a year, the three companies plan to jointly develop 40- or 50-in. displays for high-definition television applications.
Steag AST elektronik, Germany, and LUXTRON Corp., Santa Clara, CA, will jointly develop a noncontact, in situ temperature measurement solution for an AST RTP system. Under the agreement, the two firms will use LUXTRON's patented Ripple Technology to provide emissivity-independent temperature measurement for AST's SHS 3000 RTP system. LUXTRON's technology provides wafer temperature measurements from outside the process chamber within 2°C in the entire range of RTP process temperatures up to 1200°C.
Nordson Corp., Westlake, OH, and Asymtek, Carlsbad, CA, have formed the Electronics Business Group in Europe. The group combines the support and sales organizations of Nordson and Asymtek, providing automated fluid dispensing systems. The group will provide individualized technical support and innovative solutions, and the European Distribution Center, located in Maastricht, The Netherlands, will stock spare parts.
DuPont, Wilmington, DE, is expanding its colloidal silica plant in Wales, UK, by 30% to meet increased demand for CMP materials. The project is currently underway, with start-up expected by the end of the year, according to Trevor Hughes, plant manager, DuPont Wales. In addition, the company said it will begin commercial testing of a new prototype CMP product by the end of the year. The product is currently in the final development stages.
Air Liquide GmbH, Storz, Germany, has signed an agreement with Advanced Micro Devices of the US to supply its new manufacturing plant in Dresden, Germany. The agreement includes a long-term supply contract of ultra-pure gases and, through a joint venture with Dresden Elektrizität und Fernwärme GmbH and Meissner+Wurst GmbH, a long-term supply contract of ultra-pure electricity, heat, and cold. The investment will be approximately D50 million (US $30 million). The supply of gases and utilities will start this month and be fully in place by October 1998.
HTA Industries Ltd., Tamworth England, has acquired the stability electronics business and manufacturing facilities of Lucas Varity Plc. The 110,000-ft2 manufacturing facility located in Antrim, Northern Ireland, produces semiconductor products and offers a thick-film service ranging from resistor on ceramic printing to complete assemblies with 100% functional testing. The facility employs 230 people. HTA has also opened a sales and distribution center in Woburn, MA, to service US.and Canadian customers.
FASTech Integration Inc., Lincoln, MA, a provider of manufacturing execution system software in the semiconductor and electronics market, has established a new office in North Yorkshire, England, to expand and support its growing worldwide customer base. The office covers Northern Europe, including the UK, Ireland, Benelux, Scandinavia, and Israel.
Semi sets agenda for increased global cooperation
An aggressive new plan calling for increased international cooperation on issues important to all suppliers of products and services to the global semiconductor and flat panel display (FPD) industries was announced in Tokyo by Stanley T. Myers, president of Semi. The plan was developed by Semi's multinational board of directors, which met outside of Tokyo this past weekend for its annual long-range planning meeting, the first time the event has been held in Japan.
The plan calls for establishing regional advisory groups in every part of the world where semiconductor and FPDs are produced, assuring full global participation in shaping the goals of the program, as well as in meeting those goals. Myers said the board, which is comprised of senior industry executives from companies in Japan, Korea, Europe, and the US, plans to move quickly to establish these advisory groups and set specific targets by the end of this year.
"With some 2000 corporate members around the world and with 11 full-time offices in virtually every semiconductor-producing part of the world, Semi is in a unique position to facilitate cooperative efforts that benefit our members as well as the customers they serve," Myers said. "We have proven this over the past three years by coordinating global cooperation in the transition to production of larger wafers (300 mm) and also in the areas of environmental, health, and safety procedures. The global cooperation on these two programs alone have saved the industry millions of dollars in duplicated efforts and have speeded the process of accomplishing goals."
Peter Younger, VP and general manager of Eaton Corp., Beverly, MA, and chairman of the Semi board, said the board itself already has selected two areas it feels are critical to the future of the industry and could best be accomplished through global cooperation.
"One is to work together to build increased awareness of the equipment and materials industry as separate from the semiconductor and FPD industries themselves," Younger stated. "The equipment and materials Semi members produce are now actually driving the advancement of semiconductors, and increased global awareness would benefit all of us in areas such as capital formation, both from public and private sources."
Younger said that a second, closely related issue is the need to expand awareness of the technology challenges faced by this industry both at the professional education and recruitment areas, as a means of attracting more young engineers to the industry. "Throughout the world, the growth of this industry is threatened by only one thing: the lack of enough human resources to keep pace with the growth potential."
The next meeting of the Semi board of directors is scheduled for December, again in Japan, at which time it is expected that a more-detailed set of recommendations will have been developed. This will be followed next March by a global industry meeting in Geneva, at which delegates from both the semiconductor customer and supplier communities will discuss specific goals for global cooperation and outline steps for meeting those goals.
DRAMs are drivers below half-micron
 |
DRAMs garner much attention yet account for about one-sixth of the overall chip market. The figure below, by Dataquest principal analyst Klaus-Dieter Rinnen, shows that DRAMs and other memory devices constitute a greatly disproportionate share of the leading-edge (sub-half-micron) market, where most tool purchases are made. Nearly half of all silicon processed below half-micron is used for DRAMs, and about two-thirds goes into the whole memory sector (including SRAMs, flash, etc.). In more mature processes, the creaky analog, optoelectronic, and discrete devices consume the lion's share of silicon, in part because shrinking these devices isn't a priority. Also noteworthy is the doubling of microprocessor (MPU) share in the sub-half-micron realm, and a slight increase in foundry applications. — WaferNews
New forecast sees less growth
Market researcher Integrated Circuit Engineering Inc. (ICE), Scottsdale, AZ, has updated its 1997 semiconductor industry forecast, Mid-Term 1997 Status and Forecast of the IC Industry, and is now seeing an 8% growth in worldwide chip sales (down from the earlier prediction of 11%), an 8% decline in fab equipment revenues (up from 5%), and a 14% jump in semiconductor materials revenues (up from 10%). For 1997, ICE is predicting semiconductor revenues of $146.2 billion, fab equipment sales of $33 billion, and materials sales of $23.2 billion. ICE also believes that 2Q97 saw the low point for the 1997 semiconductor average selling prices (ASP). ICE said the total IC market in 1996 was more influenced byASPs than by unit volume changes; the company has drawn a correlation between excess capital spending in 1995 (resulting in overcapacity) and decreased ASPs in 1996. The firm now believes that 1Q97 was the "beginning of a gradual recovery" of the market that will continue through 1998.
Although computers are the dominant end-use market for ICs and are expected to grow over the next few years, other applications — with the exception of the military market — will still show good growth.