SPTS Technologies Ltd of Newport, Wales, UK (which is owned by Israeli firm Orbotech) has sold its Thermal Products business to SPP Technologies Co Ltd (SPT), a subsidiary of Sumitomo Precision Products Co Ltd (SPP) that specializes in the production and support of micro-electro-mechanical systems (MEMS)- and semiconductor-related process equipment.
SPTS was formed by Sumitomo Precision Products in October 2009 (as SPP Process Technology Systems Ltd) in order to merge predecessor firm Surface Technology Systems plc (STS) together with assets acquired from Aviza Technology Inc, including Newport-based single-wafer process equipment subsidiary Aviza Technology Ltd and Aviza's Scotts Valley-based Thermal Products business (which provided spare parts, upgrades, and new or remanufactured systems to customers of Watkins Johnson, SVG, and Aviza furnaces and APCVD systems). Also, December 2010 saw completion of the transfer of ownership from SPP to SPTS of Primaxx Inc of Allentown, PA, USA, a provider of residue-free MEMS dry etch release equipment.
Subsequently, in August 2011, backed by European private equity firm Bridgepoint, a management buy-out of SPP Process Technology Systems Ltd from Sumitomo Precision Products formed SPTS Technologies Ltd. Then, in July 2014, SPTS Technologies was acquired for $370m by Orbotech Ltd of Yavne, Israel (which makes production equipment for manufacturers of printed circuit boards, flat-panel displays and other electronic components).
With manufacturing facilities in Allentown, PA and San Jose, CA, USA, as well as in Newport, SPTS Technologies currently offers plasma etch, physical vapor deposition (PVD), chemical vapor deposition (CVD) and thermal wafer processing solutions for the advanced packaging, MEMS, LED, high-speed RF on GaAs, and power management device markets.
The latest transaction includes the sale of all thermal product lines and virtually all worldwide assets of SPTS' Thermal Product business, and will involve about 50 SPTS employees worldwide currently engaged in the Thermal Products business (who will become SPT employees).
"Historically, the Thermal Products business has been part of SPTS's growth and success, with a range of production-proven vertical batch furnaces that continue to be the process tools of choice at leading semiconductor fabs around the world," says Kevin Crofton, president of SPTS and corporate VP at Orbotech. "Divestment at this time, however, will benefit SPTS by enabling us to focus resources on our core Advanced Packaging, MEMS, RF and Power devices businesses [served by its etch, PVD and CVD product lines]. We believe this sale will provide new opportunities for the Thermal Products business under the ownership of SPT," he adds.
"This acquisition will allow us to expand the product portfolio that we offer our customers, create a footprint in the global semiconductor capital equipment industry and establish a worldwide presence for our company," says SPT president Toshihiro Hayami. "We expect the Thermal Products business to contribute to the success of SPT and look forward to new product development activities related to this business in its current and adjacent markets."
SPT acquired the assets of the Thermal Products business based on a valuation of about $28m, consisting of $22m in cash plus about $6m in accounts receivable. Half of the cash was paid on completion and the balance will be paid in 2016, without any performance conditions. Orbotech intends to use the net proceeds to repay a portion of the amount outstanding under its credit facilities. The firm adds that the sale does not materially affect expectations for its financial performance in second-half 2015 or its long-term business model.
In concert with the acquisition, SPT has established the new wholly owned company SPT USA Inc of San Jose, CA. Based in Silicon Valley, the newly acquired Thermal Product business focuses on selling newly manufactured and remanufactured systems, spare parts, service and upgrades, as well as product development. "We have been providing the leading-edge plasma etch and CVD technologies for MEMS and other markets in Japan," says Toshihiro Hayami, president of SPT and director of Sumitomo Precision Products Co Ltd. The formation of SPT USA "allows us to expand the product portfolio that we offer customers, and establishes a global presence for our company," he adds. "Utilizing synergy effects with our existing products and technologies, we are interested in investing in new product development activities related to the business in its current and adjacent markets."
