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IQE acquires RFMD MBE unit for $27M

Posted: 11 Jun 2012 ?? ?Print Version ?Bookmark and Share

Keywords:MBE? epitaxial wafer? epi-wafer production?

IQE plc will acquire RF Micro Devices Inc.'s molecular beam epitaxy (MBE) epitaxial wafer growth manufacturing unit, a deal that is estimated at $27 million.

However, IQE is not paying for the assets directly. Instead it will pay via a a discount-priced exclusive wafer supply agreement. This includes the supply of $55 million in wafers minimum order in the first two years.

The assets being transferred to IQE include a fully fitted clean room of over 8,361.30 square meters and 16 MBE tools housed in a 12,541.91 square meter standalone building in Greensboro, North Carolina. The local management and employees for the unit, consisting of 70 people, will also transfer directly to IQE.

IQE said that it intends to use unallocated capacity from the Greensboro facility to increase its supply of wafers for concentrated photovoltaic solar cells in respect of an agreement with Solar Junction Inc.

The agreement with RFMD is expected to allow IQE to expand its supply of wafers for solar to a value of $35 million annually without the need for significant capital expenditure.

"The deal secures IQE world class epi-wafer production assets and staff, together with a long term wafer supply agreement, further strengthening our leadership position in the supply of wafers to the global wireless industry," said Drew Nelson, president and CEO of IQE, in a statement.

RFMD's GaAs semiconductor products incorporate transistor layers grown on either an MBE or metal organic chemical vapor deposition process. RFMD already outsources all MOCVD-based starting material, and RFMD will outsource MBE-based starting material with the completion of the transfer to IQE. RFMD will continue to own and operate wafer fabs for RF components in Greensboro, and Newton Aycliffe, England.

Bob Bruggeworth, president and CEO of RFMD, said: "We believe this is a mutually beneficial transaction for both RFMD and IQE. Of note, we expect this transaction will provide RFMD with lower MBE and MOCVD pricing, higher return on invested capital (ROIC), and more predictable operating results."

- Peter Clarke
??EE Times

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