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Editorial: Lumileds Ramping
... (Revised and expanded from original July 8th post) Lumileds Lighting of San Jose, California USA, which retains the number one slot when it comes to high end HB-LEDs of all colors, including the most sought-after bright white LEDs, is again ramping their production capability. In May, Lumileds announced ramps...
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July 8, 2004...Score one for the good guys, which the famed CNN financial guru, Lou Dobbs,
does in his "Made In America" segment, and the "good guys"
this time were our own guys. The Thursday evening, July 8th spot was longer
than the usual, extremely well done and featured one of our major compound semi
industry sapphire suppliers, Rubicon Technology
of Chicago, Illinois. Rubicon was featured primarily because it takes very good
care of its 125 employees, and also because it makes a substrate for one of
the most exciting fields in the world... the solid state lighting industry,
which is destined... as we here in the compound semi community well knows...
to replace conventional forms of lighting with solid state, blue spectrum LEDs,
the vast majority of which are grown on sapphire substrates. The hook that enticed
the Lou Dobbs show to send ace producer, Lisa Sylvester and crew to Rubicon's
home base in Chicago... besides the fact that this thriving, privately held
company does all its own manufacturing in the good
old US of A, but it sends 90% of its product to Asia. Lisa and crew came in
and shot excellent footage of the Rubicon plant for hours and interviewed Rubicon's senior management,
Chris Moffitt, President/CEO and Joe Cox, VP of Operations. Bruce Rylance, VP of Sales and Marketing, was... as usual, on travel.
With the high caliber international exposure CNN's Lou Dobbs Show generates,
Rubicon Technology automatically becomes a company the investment community,
as well as the customer base will keep an especially close eye on. Business
is so good right now... and with blue spectrum LEDs catching on so well in
all application areas, there's no sign that pace will let up in the near, or
far future... that Rubicon is currently "sold out" of product
and increasing their capacity and output as quickly as possible to keep up with
demand. And... they're in major hiring mode. One of the points that Lisa made
in her report was that Rubicon was selected for the "Made in America"
slot because it provides excellent stock options and 100% health coverage. In
return for treating their people so well, Rubicon gets its pick of high caliber
USA talent required to produce top notch sapphire crystals and substrates. The
Nitride world is extremely dependent on good substrates, which is what Rubicon
obviously provides. And now the general public knows a bit more about what that
business is all about. What's in store next for Rubicon Technology? Possibly
an IPO, so they can ramp further, and faster. With the kind of exposure they
just received from CNN, all we can promise for now is... Stay Tuned...
Fairchild and Changhong Flexing "Green Power"July 8, 2004...The kind of story that always ranks good coverage in our pages is one that focuses
on bettering the environment, and the announcement of Fairchild of South Portland,
Maine USA teaming with one of China's largest consumer products manufacturers
to establish a joint technology laboratory does just that. Fairchild Semiconductor,
which specializes in high performance products that optimize power (and does
so with a significant emphasis on compound semi based materials), has announced
the opening of a joint product development laboratory with Sichuan Changhong
Electric Co., Ltd. - one of the largest manufacturers of consumer devices in
mainland China. The new lab enables the companies to collaborate on product
development using Fairchild's leading edge power components, which are being
designed into a broad range of Changhong products, including color TVs, LCD
TVs, PDP TVs, rear projection TVs, DVDs, set-top boxes and air conditioners.
Fairchild and Changhong have had a close relationship for several years. This
project extends that cooperation.
"The first phase of our joint development will focus on green power
technology," said Zheng Guangqing, executive vice president of Changhong.
"With energy conservation critical to our 60 million customers and to
the overall environment in China, we are dedicated to creating new products
that balance energy savings and power minimization while still delivering the
highest quality. As a leader in green power, we look forward to continuing our
work with Fairchild to meet requirements that include low output voltage, high
performance, efficient control of power supplies and quick reaction to changes
in current." Changhong is known for technical innovation, quality products
and significant production capabilities. Fairchild products designed into Changhong
consumer devices include Green Mode Fairchild power switches, advanced
power MOSFETs, interface switches, diodes, logic devices and rectifiers. More
details are in the company
news release.
Riber Installs Two More Research MBE Systems in AsiaJuly 8, 2004...Riber of Paris, France has delivered and installed two more Compact 21 Molecular
Beam Epitaxy (MBE) systems to prominent research institutes in Asia, National
Sun Yat-sen University (NSYSU: Institute of Electro-Optical Engineering) in
Kaohsiung City, Taiwan and the second has been purchased by the Center for Nano
Materials and Technology of the Japan Advanced Institute of Science and Technology
(JAIST), in Tatsunokuchi, Ishikawa Prefecture, Japan. NSTSU will use the machine
for growing emerging materials for electro-optical applications. The equipment
will be operated under the supervision of Prof. Tao-Yuan Chang, former senior
scientist at the Lightwave Devices Research Department of Bell Laboratories
(USA). NSYSU already owns two Riber systems. The JAIST system will be used by
the Quantum Device group (Dr. Yamada and Dr. Suzuki) for the growth of high-quality
heterostructures of nitrogen-containing compound semiconductor materials (nitrides).
This Compact 21 is the third Riber MBE system at JAIST. Company
news release Nottingham University Spins Applications with Veeco GEN III MBE SystemJuly 8, 2004...If you haven't heard about "spintronics" you soon will. That's a
general term for defining a promising new class of semiconductor electronics,
so says Veeco and Nottingham University in the UK. Nottingham has just purchased
a GEN III molecular beam epitaxy (MBE) system from Veeco's St. Paul,
Minnesota arm in the USA. The R&D system will be used to investigate multiple
materials for spintronic applications. "At Nottingham University we
are investigating a number of different material systems, some of which may
have Curie temperatures above room temperature (critical for usable end product
applications)," said Professor Tom Foxon. "The GEN III system's
14 source ports will enable us to investigate many possible alternative materials
without changing MBE sources." So what differentiates spintronics from
conventional semiconductor devices? While the conventional types operate by
controlling the flow of electrons and holes based on their "charge,"
spintronics uses the fundamental property of electron "spin" for novel
device applications such as: ferromagnetic metallic alloys for read heads and
magnetic random-access memory; integration with microelectronics technology
to produce ultra-fast switches and microprocessors; and large-scale quantum
computing. So there you have it. The latest "spin." Details
are in the company
news release. Domenico Fumagalli to Head European Sales for Colibrys in MilanJuly 8, 2004...Colibrys SA of Neuchatel, Switzerland has appointed Mr. Domenico Fumagalli
as European Sales Manager. Mr. Fumagalli will be based in Colibrys' newly established
office in Milan, Italy. Mr. Fumagalli has over 20 years experience in semiconductors,
lasers and visual technologies, managing Telecommunication, Industrial and Automotive
market segments. He has previously held sales management positions in Motorola
Semiconductors Europe, Hitachi Europe, Multilink Technology Inc. and most recently
Santel Networks Inc. His appointment will reinforce Colibrys' strategies targeted
at high reliability accelerometers for defense, oil/gas exploration and Instrumentation
markets and optical MEMS devices for telecoms and Industrial markets. The company
has a strong technical and reliable MEMS manufacturing background. Consult the
company
news release for contact names and the proper European addresses involved. WJ Communications Adds to CATV OfferingsJuly 8, 2004...WJ Communications of San Jose, California USA has announced the addition of
the HMJ7-1, a new high dynamic range GaAs FET mixer designed to suit DOCSIS
2.0 CATV head-end equipment by providing enhanced suppression of intermodulation
products needed for higher performance CATV applications. "The introduction
of the HMJ7-1 is optimized for customers looking for a high-performance device
designed to meet the strenuous requirements for the DOCSIS 2.0 and Euro DOCSIS
standards," said Ron Buswell, senior vice president of marketing and
product line management for WJ Communications. "This product broadens
WJ's industry-leading CATV mixer portfolio and serves as another example of
the advantages of the flexible manufacturing platforms that we have."
Consult the company
news release for product details. Aixtron to "Merge" with USA Nano Deposition Company Genus in $143.2 Million Stock DealJuly 6, 2004...Jumping on the "nanotechnology" deposition bandwagon (which compound
semi industry MOCVD and MBE companies essentially created), Aixtron
AG of Aachen, Germany has announced
it is "merging" with a USA atomic layer deposition (ALD) equipment
company named Genus, Inc.,
which is based in Sunnyvale, California. Genus trades on the Nasdaq stock exchange
under the symbol "GGNS"
and after the merger is approved, Aixtron stockholders will own approximately
74% of the combined company, Genus shareholders the remaining 26%. The stock-for-stock
transaction is valued at approximately $143.2 million (€117.7 million)
based on current stock values. Plans are for Aixtron to acquire all outstanding
Genus shares and Genus shareholders will receive 0.51 American Depository Receipts
(ADRs) of Aixtron in exchange for each Genus common share which, if approved,
will essentially put Aixtron shares on the Nasdaq exchange. While the word "acquisition"
was not used, Reuters
referred to the deal as just that, saying Genus would become a wholly-owned
subsidiary of Aixtron. According to the SEC
filings by Genus, two key points of the merger are: 1) approval for Aixtron shares
to be listed on the Nasdaq, and 2) that the two companies would jointly design
and develop a hybrid ALD/AVD multiwafer product.
Combined, the two employ over 550 people worldwide. “Both companies
have more than 20 years of experience in the semiconductor equipment business
and are an ideal fit. The semiconductor industry increasingly requires new complex
material solutions which we offer“, said Paul Hyland, President and
CEO of Aixtron. “The combined company will leverage Aixtron's know-how
in complex material deposition and Genus’ strength in new semiconductor
deposition technologies for such materials. We are thereby well positioned for
the next investment cycle in the semiconductor industry, and to benefit from
a strong position in this global industry, which enables further growth.“
Genus’ Chairman and CEO William W. R. Elder said: “Our products
are highly complementary. The merger will strengthen our balance sheet and in
the medium term the cooperation in research and development should enable the
realization of synergies in the development and production of our products as
well as additional revenue benefits”. The two companies reported total
2003 revenues of approximately €142 million ($160 million), a combined
gross profit of approximately €32 million ($36 million) and cash and cash
equivalents of approximately €78 million ($99 million). Paul Hyland will
remain President and CEO of Aixtron. Mr. Elder will join the Aixtron Management
Board. It is presumed that, like other Aixtron subsidiaries such as Thomas Swan,
that Genus will maintain its own name and individual corporate and brand identity,
although such was not stated in the announcement.
And while there was also no mention of other Aixtron subsidiaries and other
ventures, it is not yet clear whether the merger will equate to Genus shareholders
owning proportionate percentages of those entities or if Genus will be treated
as a wholly owned subsidiary of Aixtron as Thomas Swan is. For sure, Genus will
now be part of what our community knows as "The Aixtron Group."
Whereas our compound semi community is well-acquainted with Aixtron's offerings,
Genus is a new name to our ranks, and appears to focus more on deposition processing
products for the advanced silicon-based data storage industry with its LYNX
and StrataGem series equipment for 200mm and 300mm silicon semiconductor
production, and offering thin film deposition products for chemical vapor deposition
(CVD), atomic layer deposition (ALD), and pre-clean capabilities. The company
is regarded at the forefront of market and technology developments in the ALD
marketplace, which some feel is a fresh buzzword for what the compounds have
been doing for some time. Genus appears targeted at the sub 0.13-micron production
of silicon chips and storage devices. With Aixtron taking such a large ownership
role in this merged entity, and given Aixtron's other compound semi-related
concerns, the scales might become more balanced between Aixtron and its closest
global MOCVD competitor, Veeco (a strong
supplier of varied equipment to the silicon industry), which entered the
compound semi MOCVD market with the purchase of Emcore's TurboDisc MOCVD
division. Veeco also owns the former Applied Epi, a longtime provider of compound
semi MBE equipment and remains the only company to provide both MOCVD and MBE.
Aixtron has long been peripherally involved in the silicon industry with their
oxide machines.
Lite-On's Profits Provide Clue to USA Red Number DayJuly 7, 2004...Here's a clue to what might be a sign of why the USA compound semi stocks all
took a recent downturn (ref: our July
6 editorial). According to a July
7 DigiTimes report, one ideally typical Taiwan component provider,
Lite-On, reported an 85% increase in revenues for the first half of the year,
a rise of 69% for the entire year to date, with reported consolidated revenues
of NT$13.47 billion for that first half year. Their power supply product line
was up 31%, their optoelectronics (LEDs and photocouplers) were up 62%
and "other" was up 48%. Consult the DigiTimes
report for their usual good revenue charting for exact details. Our news features are reported
by the CompoundSemi News staff writers.
For submissions or content suggestions, you can contact us using
editor -at - compoundsemi.com
For more information and to reserve promotion space contact
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The
McDonald Report
Commentary & Perspective...
Lumileds RampingJuly 13, 2004...(Revised and expanded from original July 8th post) Lumileds Lighting of San Jose, California USA, which retains the number one
slot when it comes to high end HB-LEDs of all colors, including the most sought-after
bright white LEDs, is again ramping their production capability. In May, Lumileds
announced ramps at their new Malaysian plant for expanded production of their
warm white LEDs (ref our May
13th coverage). And now Lumileds has officially inked an impressive
purchase order with Aixtron AG of Aachen, Germany which has long supplied Lumileds
with MOCVD reactors, beginning with platforms that produce the high quality
red spectrum LEDs for which Lumileds originally gained their strong reputation
in the traffic light applications area.
And word has it that Lumileds is due to complete another contract with Veeco
for more TurboDisc reactors as well. The TurboDisc line, formerly
supplied by Emcore, which was sold to Veeco, lock stock and barrel, includes
the SpectraBlue and GaNzilla models which are GaN machines, which
Lumileds has employed to produce their white LEDs for quite awhile now. (Ref:
Oct 2001 news Lumileds
Recruits GaNzilla for Stepped Up Green & Blue LED Production. As
noted in that article, Aixtron also supplies Lumileds with their high end GaN
Planetary reactors.
The impressive four year deal just signed with Aixtron, as announced July
7th, (ref:
company news release) is a purchase order for "a significant number"
of Aixtron Planetary reactors to help beef up Lumiled's anticipated production
capacity over the next four years. Exact details of number and type machines
were not included, but Paul Hyland, President and CEO of Aixtron was quoted
as noting that "This agreement reflects the biggest order Aixtron has
taken in its history, made even more significant by Lumileds leadership position."
The biggest order in Aixtron's history equates to a huge ramp at Lumileds. Lumileds
is, indeed, regarded as being in a strong leadership position in rolling out
the highest quality HB-LEDs in all colors.
When one looks at the continual buildup commitment of the USA's two largest
blue spectrum LED makers, Lumileds Lighting in San Jose, and Cree, Inc. in Durham,
North Carolina, a company that also employs an impressively large number of GaN MOCVD platforms
(also from various, though unnamed, vendors), one can surmise that Taiwan isn't the only
country ramping in an effort to dominate the the solid state lighitng industry.
From what we can see, the world appetite for these terrific tiny lights is just
getting whetted, so there appears to be plenty of business out there. The leading
USA HB-LED providers, especially when it comes to blue spectrum LEDs appear
to definitely be in it for the long haul.
What I'd like to see now (and metrics I think would be helpful to the entire global industry), would be an actual count of the total number of MOCVD reactors out there devoted to commercial HB-LED production, along with estimates of what their typical output might be, maybe even in the various application categories (a tall order). But if we could come up with that, I'd bet those resulting metrics would be something that would knock the socks off any business analyst, journalist or commentator. The fledgling Solid State Lighting (SSL) industry is literally lighting up the world! And it wouldn't have happened without the exceptional breadth and depth of our supply infrastructure.
Aixtron's Unique Positioning for Entry Onto the NasdaqJuly 8, 2004...I don't think I've ever seen a compound semi company go public on the USA's
Nasdaq stock exchange
in quite the manner Aixtron appears to be going at it. Granted, I'm no Wall
Street expert, but over the 25 years I've been watching companies go public
on the Nasdaq... which is the preferred exchange (versus the New York Stock
Exchange, aka "NYSE") for small, aggressive startups and even
more aggressive grown-up companies that have long matured from startup mode...
usually they necessarily have to go through the usual application process, then
the painful quiet period (when everyone in the company is all atwitter with
excitement), then the big hoopla and everyone who's been papering their
wall with heretofore relatively worthless stock certificates gets rich, overnight.
At least that's how the classic Silicon Valley fairy tale used to play
out... and sometimes still does (and probably will in the case of Google's pending IPO on Nasdaq). Many an early employee at Intel, Microsoft,
etc., did just that. They became millionaires in one day. With the exception of Google, of course, these days you're
lucky to even make it to the trading floor, let alone get rich quick. And if
your stock dips below $1 for too long, you get bounced off, pronto.
Mandatory "quiet times" (where you're not allowed to say anything
that can smack of hype) are the norm when something significantly is in
the works, and companies these days have to be exceedingly upfront and very,
very careful about what they say, whom they say it to... and when and why...
and they have to constantly play by the SEC rules, and tell it all to "Uncle
Sam" before they say anything to anyone else. The USA's Security
and Exchange Commission (SEC) really does RULE when it comes to the markets.
But back to Aixtron... Note in our coverage of their merger
with Silicon Valley-based Genus
(July
6th, top news story), that from the looks of that initial company
news release, what appears to be a straightforward acquisition of a USA
company that is currently listed on the Nasdaq, seems to be an innovative
way for this mainstay compound semi industry MOCVD supplier, which is headquartered
in Aachen, Germany, to quickly become a Nasdaq company. Scroll
down to the bottom of the release to the section called Additional Information about this Transaction.
It says... "AIXTRON plans to file a registration statement on Form F-4
with the U.S. Securities and Exchange Commission, or SEC, which will include
a prospectus of AIXTRON and a proxy statement of Genus. Investors and security
holders are urged to read the proxy statement/prospectus regarding the business
combination transaction referenced in the foregoing information, when it becomes
available, because it will contain important information." Important, indeed. And it will be interesting to see how this all plays
out.
Aixtron's stock (AIXTRON AG... FSE: AIX ISIN DE0005066203) is already listed
in the Prime Standard and Tec-DAX of the German Stock Exchange (Deutsche Börse)
and is included in the MSCI World Index. The really great thing about adding
the Nasdaq to their trading opportunities the exposure they'll then be entitled to in the mainstream financial and business press as other Nasdaq companies enjoy, and speaking as a journalist, they'll then have the same
accessible body of public information out there as their nearest competitor,
Veeco. Veeco has long been listed on the Nasdaq (Symbol: VECO) and investors as well as the press will likely enjoy being able to access "apples to apples" types of information that will continue to bolster the credibility and testify to the continuing growth opportunities offered by the compound semi industry.
With all the globalization going on, it's hard to keep up with who's actually based where anyway anymore, but the net effect is "easier data" for everyone. What I find especially interesting is the immediate "Nasdaq-like"
posture of Aixtron's investment-related press releases since the announced
merger with Genus. The addition of the traditional "forward looking statements"
mandatory caution that those of us who closely follow USA publicly held companies
are so familiar with (which nobody ever reads or listens to anymore... typical
"rules") is the first thing that caught my eye. It translates to mean... "this
is an American company!" Personally, as an American-based international
technology journalist, I find that as refreshing as when I met the new Aixtron
management team at the annual Compound Semi Outlook Conference in Dallas last
December. They're a great bunch of guys who are doing a terrific job helping put
the compound semi industry on the worldwide semiconductor map. And soon, I'll
be able to get their news and notice of their filings immediately, the
same as I do from all the other Nasdaqers, as it hits. When you deal
in 24/7 news coverage like we do... that's as good as it gets!
If you have questions about the
solid state lighting and compound semiconductor industries or have news
or views to share, I'm Jo Ann McDonald, Editor of LIGHTimes and CompoundSemi News.
Feel free to contact me directly, anytime. 
My direct tel at the ranch is
+1-325-463-5345
From time to time Jo Ann may comment on companies in which she holds a
modest investment - be sure to read
her disclosure at some point in time... |
