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5 December 2014

Veeco acquires SSEC for $150m

Epitaxial deposition and process equipment maker Veeco Instruments Inc of Plainview, NY, USA has acquired privately held Solid State Equipment Holdings LLC (SSEC) of Horsham, PA, for about $150m in cash (subject to customary adjustments).

SSEC designs and manufacturers single-wafer wet etch, clean and surface preparation equipment targeting high-growth segments in advanced packaging, micro-electro-mechanical systems (MEMS) and compound semiconductors.

“SSEC is a highly successful process equipment company that is a great strategic fit with Veeco,” says Veeco’s chairman & CEO John R. Peeler. “Their complementary and differentiated ‘soak and spray’ technology delivers single-wafer control with the low cost of batch processing,” he adds. “SSEC extends our compound semiconductor and MEMS footprint, and represents a stepping stone to the high-growth advanced packaging market.”

Demand for higher performance, increased functionality, smaller form factor and lower power consumption in mobile devices, consumer electronics and high-performance computing is accelerating the adoption of advanced packaging technology, says Veeco. Key drivers for this inflection are applications in 3D stacked memory, 3D system-on-chip (SoC) and MEMS. Rising shipments in smartphones and wearable electronics with more sophisticated sensing functions are further driving growth in the MEMS market. Veeco estimates that its served available markets for advanced packaging, compound semiconductors and MEMS are all growing at double-digit compound annual growth rates (CAGRs).

“Veeco is a dynamic market leader in compound semiconductor equipment for LED, power electronics, and wireless devices,” comments SSEC’s CEO Herman Itzkowitz. “Combining resources will enable us to accelerate growth and to pursue market opportunities in advanced packaging and MEMS. In addition, we have significant untapped potential in Asia and Europe, where Veeco’s impressive sales and service network will provide connectivity to key customers,” he adds.

Veeco is forecasting that SSEC’s revenues will be $65m in 2015. Given SSEC’s financial performance over the last few years, Veeco expects it to provide earnings before interest, taxes, depreciation, amortization, equity compensation, and other non-recurring items (adjusted EBITDA) of greater than 20% of sales in 2015. The transaction is expected to be significantly accretive to Veeco in fiscal 2015 on a non-GAAP earnings per share basis. “This is a synergistic transaction that will be immediately accretive and that we expect will drive growth and profitability,” says Peeler.

See related items:

SSEC adds WaferEtch and WaferStorm platforms to single-wafer wet processing product portfolio

Tags: Veeco MOCVD Solid State Equipment Wet processing

Visit: www.ssecusa.com

Visit: www.veeco.com

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