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Editorial: Perspective on TriQuint's Sale of InP Opto Business to CyOptics
... The rumors were correct. TriQuint has just announced the sale of their InP-based optoelectronics units in Breinigsville, Pennsylvania in the USA to CyOptics of Lehigh Valley (Allentown), Pennsylvania for approximately $38 million, plus taking a minority share in CyOptics. Approximately 150 people in Pennsylvania and Mexico are involved in...
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April 14, 2005...In the optical compenent game TriQuint Semiconductor is handing off the ball to CyOptics. TriQuint Semiconductor with headquarters in Hillsboro, Oregon USA is selling their Indium Phosphide optical business to CyOptic of Lehigh Valley, Pennsylvania including their manufacturing facilities in Breinigsville, Pennsylvania, and Matamoros, Mexico. TriQuint expects to receive $32 million in total from the sale with approximately $22 million of it in cash and a one-time gain of $7 to 8 million. After the completed sale, the operating expenses are projected to decrease by $1 to $2 million per quarter. TriQuint Optoelectronics, headquartered in Breinigsville, Pennsylvania, designs, develops and manufactures optoelectronic components, integrated optical modules, and InP chips for optical communication networks. Similarly, CyOptics designs, develops and manufactures optical engines for broadband metro and access communication networks. CyOptics says it plans to employ the vast majority of the 100 employees in TriQuint’s Pennsylvania facility and the 150 at the Matamoros, Mexico facility. TriQuint will retain its mainstream manufacturing facilities in both Hillsboro, Oregon and Richardson, Texas and its gallium arsenide (GaAs) optoelectronic product lines.
On March 11, 2005 TriQuint sold its 850,000 square feet optoelectronics facility and surrounding property in Breinigsville, Pennsylvania, to Anthem Partners, LLC, an affiliate of MRA Group of Plymouth Meeting, Pennsylvania. MRA plans to transform the existing facility into an advanced technology development and research center, featuring a combination of bio-medical engineering, high tech manufacturing, and a related education advancement and conference area. CyOptics will lease approximately 90,000 square feet of space in the facility once it has completed the purchase. Triquint anticipates the sale to CyOptics will close by the end of April 2005 and the sale to Anthem by the end of May 2005.
Ralph Quinsey, TriQuint president and CEO, stated, “The optoelectronics market will only support a few right sized and nimble players that are positioned for further investment in this market. Merging TriQuint’s optoelectronics business with the privately held CyOptics provides a more optimal operating environment and return on investment horizon for the business.” He added, "We now intend to turn our full attention to our growing businesses in the wireless handset, base station, defense, and wireless broadband access markets building on our portfolio of successful semiconductor and filter products.”Company News Release Fairchild Deploys Rossetanet Solution to Incease Ease of Doing Business With Distributors
CompoundSemi News StaffApril 14, 2005...Designing, prototyping, and ordering products requires information about which component product is best suited for the design requirements and sorting through a long list of components to find the right one. Fairchild Semiconductor, a dominant player in power electronics, has taken steps to streamline the price quoting, design win registration, and order management of their products between Fairchild and their distributors. The Rosettanet solution for design win registration will allow instantaneous information exchange with distributors through the RosettaNet B2B standard and it connects with Fairchild's FOCUS program. The solution tracks prototyping information and activity and provides Fairchild a better view of customer design requests and requirements. The company has deployed a Rosettanet-based solution and will demonstrate the e-business solution jointly with Wintech Microelectronics, a dominant IC distributor in Asia, at the RosettaNet Global Partner Conference in Beijing, China on April 21, 2005. Fairchild implemented the FOCUS design registration program in 2003 with key distributors such as Arrow Electronics.
Fairchild says it is committed to Rosettanet, a non-profit consortium of over 500 companies created to promote open e-business standards and services. "Our goal in delivering RosettaNet-based quoting is to increase distributor satisfaction in choosing Fairchild - in essence, to make it easier to do business with ussaid Eric Pannekeet, Fairchild's manager Corporate RosettaNet Development. "Fairchild is one of the first suppliers to implement this new solution globally across Asia, Europe and North America. RosettaNet-based solutions are a key part of our strategy to increase global demand for our industry-leading power products." Siliconix Asks Stockholders to Wait for Board Recommendation Regarding Vishay OfferApril 14, 2005...Siliconix requested that stockholders take no action at this time concerning the unsolicited tender offer by Vishay for the outstanding shares of stock pending a recommendation from the board of directors. Vishay International currently owns 80.4% of Siliconix stock. Siliconix of Santa Clara, California USA, a player in the power electronics field who was recently mentioned in a Forbes article, said their board of directors, independent legal counsel Heller Ehrman LLP, and their financial advisor, Lehman Brothers Inc. will carefully evaluate the offer. According to the company, the board of directors will issue a recommendation on or before April 25, 2005. Anadigics Gets Orders for Wimax Power AmplifiersApril 14, 2005...Anadigics received orders for their Indium Gallium Phosphide (InGaP) heterojunction bipolar transistor AB power amplifier (PA). The PA boasts interoperability for WiMAX applications worldwide. Anadigics' 4.5 mm by 4.5 mm AWM6430 WiMAX PA module has an integrated step attenuator and output power detector, which minimizes the number of external components, PCB space requirements, and development costs for new designs. According to the company the PA module provides excellent linearity with an error vector magnitude (EVM) of less than 2.5% at 24 dBm. The module offers fully matched RF ports and can operate from either a single 5V or 6V power supply. Anadigics' WiMAX PA is fully compatible with IEEE 802.16-2004 and ETSI EN301-021 standards and complies with the European Union's Restriction of Hazardous Substances (RoHS) directive.
The new PA modules use Anadigics' InGaP HBT technology and boasts advantages over AlGaAs technology including better performance, reliability, and manufacturing yield. This adds to Anadigics portfolio of power amplifiers for next-generation 2.5 GHz and 3.5 GHz 802.16e mobile applications. Ron Michels, vice president of broadband products at Anadigics said, "Our class AB WiMAX power amplifiers provide superior efficiency compared with class A power amplifiers and offer the industry's best level of linearity to customers.”
Keithley Instruments Introduces Fully-Automated Testing System for Testing Reliability and Lifetime of SemiconductorsApril 12, 2005...Keithley Instruments has demonstrated a fully-automated system to test semiconductor reliability and lifetime. According to the company, the S510 provides a turnkey solution for modeling of the advanced ULSI CMOS processes down to 65nm nodes and beyond. The S510 boasts reduced time required to do the modeling thereby decreasing the time-to-market for projects in technology development and process qualification. It can test multiple devices on a wafer simultaneously with a fully-automatic or semi-automatic probe station. According to the company, it can also handle high channel count parallel negative bias temperature instability (NBTI) and time dependent dielectric breakdown (TDDB) testing, unlike its competitors. In addition, it can work in conjunction with a fully automated production prober. The S510 runs on the KTE automation test executive software. The interactive component of KTE (KTEI) allows real-time graphing and interactive test modules. The S510 can be configured to perform device characterization, thereby avoiding the need for a separate system. This system adds to the wide-range of Keithley's fully automated electronic testing systems. TIR Introduces Lexel to Replace Conventional 75W Light SourcesApril 13, 2005...At the Lightfair International in New York, TIR of Burnaby, British Columbia Canada unveiled their new Lexel lamp which reportedly can produce light output approximately equivalent to a 75W bulb. Content continues for LIGHTimes SecondPage members... Researchers Reach New Milestone on the Road to Terahertz Transistor
CompoundSemi News StaffApril 12, 2005...Researchers from University of Illinois at Urbana-Champaign (UIUC) have developed a high-bandwidth transistor (HBT) that reached an impressive 604 GHz and demonstrated a breakthrough in speed and design, according to a Applied Physics Letters article. The InP/InGaAs transistor, which was produced by Milton Feng and Walid Hafez at the UIUC Micro and Nanotechnology Laboratory, uses a compositionally graded collector, emitter and base to reduce transit time.
“Pseudomorphic grading of the material structure allows us to lower the bandgap in selected areas,” said Mr. Feng. “This permits faster electron flow in the collector and improves the current density.” Mr. Feng said that conventional HBT’s would melt because of high current density if they approached 1 terahertz. He added, “In our pseudomorphic HBT, we can operate at higher frequencies with less current density.” The device, with a 0.4 x 6 µm emitter, achieved a fT value of 604 GHz, and an associated fmax of 246 GHz, at a collector current density of 16.8 mA/µm2. Developments such as these may one day make their way into faster and more flexible computer systems.
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The
McDonald Report
Commentary & Perspective...
Perspective on TriQuint's Sale of InP Opto Business to CyOpticsApril 14, 2005...The rumors were correct. TriQuint has
just announced
the sale of their InP-based optoelectronics units in Breinigsville, Pennsylvania
in the USA to CyOptics of Lehigh Valley
(Allentown), Pennsylvania for approximately $38 million, plus taking a minority
share in CyOptics. Approximately 150 people in Pennsylvania and Mexico are involved
in the transfer, most of whom will be picked up by CyOptics, which currently
is headquartered relatively near Breinigsville.
Step one of the divestiture of the Pennsylvania facility was in March of this
year when TriQuint entered into an agreement to sell its nearly 850,000 square
feet optoelectronics facility and surrounding property in Breinigsville to Anthem
Partners, LLC, an affiliate of MRA Group of Plymouth Meeting, Pennsylvania.
MRA intends to transform the existing facility into one of the Mid-Atlantic
region’s most advanced technology centers, featuring a combination of technology
research and development, bio-medical engineering, high tech manufacturing,
and a related education advancement and conference center. CyOptics will lease
approximately 90,000 square feet of space in this facility for its operations
once it has completed its purchase of the business from TriQuint, which is expected
to close by the end of April 2005. The sale to Anthem is expected to close by
the end of May 2005.
TriQuint originally purchased the Breinigsville operation from Agere in October
of 2002 for $40 million in cash (ref our Oct. 23, 2002 headline news and editorial
coverage.
Those who have been in this business awhile will remember that the Agere opto
operation was originally quite strong, but by the time Agere decided to finally
sell it off, it included about 80 development engineers, 20 marketing people,
and 50 process engineers, plus 150 assembly & test manufacturing and engineering
people in the Mexico facility. Considering Agere had basically driven their
opto business into the ground, TriQuint made a valiant effort to hold everyone
together and build the business back up. Alas... there's still simply not enough
InP opto business out there, and still too many players chasing a limited market.
The telecom bust remains a sad sector, with few likely to survive. With the
purchase by CyOptics of the TriQuint InP opto operation, CyOptics now stands
a decent chance of being one of the survivors.
The sale is good news to TriQuint fans. Consolidation is a way of life these
days, so this news was expected. What it means primarily to the compound semi
industry, is that TriQuint is doing what other wise companies are doing, and
getting back to their core strength, leaving the InP opto gamble to those who
can concentrate on just that. TriQuint's core strength is what it's always been...
According to TriQuint's President and CEO, Ralph Quinsey, "We now intend
to turn our full attention to our growing businesses in the wireless handset,
base station, defense and wireless broadband access markets building on our
portfolio of successful semiconductor and filter products.”
Ralph told analysts in a late Thursday afternoon conference call regarding
the sale (an online replay
of which is available), that the InP based and MOCVD platform-rich Breinigsville
plant was originally expected to yield in the neighborhood of $50-60 million
per year in revenue when they took over the business from Agere. That's before
they found out how badly Agere had run the business down. It only produced revenue
in the $30 million per year range. TriQuint's people have done their best to
build it back up. Privatizing the business and teaming it with CyOptics, which
has hung in the InP game admirably, gives Breinigsville it's best shot for continued
survival. "Only a few right sized nimble players will survive,"
Ralph predicted. TriQuint won't be completely out of the opto game either. It
will continue to support it's traditional GaAs opto drivers and TIA business
from TriQuint Texas in Richardson, Texas, deemed a relatively small operation.
This move is a sign of the times. The globalization of many businesses is one
factor. CyOptics was born and raised out of Bell Labs and is closely tied to
Israel. Whereas the USA continues to suffer in the telecom sector, action in
other countries, especially Asia and the Middle East, is doing much better.
And CyOptics has focused solely on InP since its inception. The company's device
manufacturing capability includes InP wafer fab, re-growth, and characterization.
They have a 7,000 sq. ft. wafer/chip fab in Yokneam Illit, Israel. In addition
to what they'll inherit at Breinigsville, they also have a 30,000 sq. ft. automated
assembly and test facility in nearby Allentown Pennsylvania in the USA... and
CyOptics is fully ISO9001:2000 certified. The technical founders of CyOptics
recently showed the good sense to hire themselves a good boss. Their new President/CEO
is Ed J. Coringrato (ref Mgt
Team).
The other sign of the times is another factor. For the next three years, for
sure, as long as the current USA administration stays on the warpath, the defense
business is one of the only sectors doing really well. And TriQuint's people
are old pros when it comes to defense applications. TriQuint Texas began as
a TI/Raytheon team on the famed MIMIC program, and it's in the leadership position
once again with the recent award as one of three primes to score the long awaited
DARPA GaN contracts. (Ref. our March 14th headline
news and editorial) which will put TriQuint on a lot of people's roadmaps
for GaN foundry work.
So I see this as an excellent move on many fronts. TriQuint is moving on and
will be helping pioneer one of my favorite compounds, GaN. And given the current
economic and political climate, worldwide, the privatizing of Breinigsville
and putting it back in the hands of the type people who originally created it,
Bell Labs and Lucent descendants, is a step in the right direction for InP.
Now... if the communications sector would just start to pick up a bit...!!!
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... |
