Accretive Acquisition Provides Complementary, Differentiated
Technology for Greater Access to High Growth Markets
Management Conference Call to be Held Friday
December 5, 2014
PLAINVIEW, N.Y.--(BUSINESS WIRE)--
Veeco Instruments Inc. (Nasdaq:VECO) today announced that it has
acquired privately held Solid State Equipment Holdings LLC (“SSEC”),
based in Horsham, Pennsylvania. SSEC is a leading innovator in single
wafer wet etch, clean and surface preparation equipment targeting high
growth segments in advanced packaging, micro-electro-mechanical systems
(MEMS) and compound semiconductor.
“SSEC is a highly successful process equipment company that is a great
strategic fit with Veeco,” said John R. Peeler, Veeco’s Chairman and
Chief Executive Officer. “Their complementary and differentiated ‘soak
and spray’ technology delivers single wafer control with the low cost of
batch processing. SSEC extends our compound semiconductor and MEMS
footprint, and represents a stepping stone to the high-growth advanced
packaging market. This is a synergistic transaction that will be
immediately accretive and that we expect will drive growth and
profitability.”
Demand for higher performance, increased functionality, smaller form
factor and lower power consumption in mobile devices, consumer
electronics and high performance computing is accelerating advanced
packaging technology adoption. Key drivers for this inflection are
applications in 3D stacked memory, 3D system-on-chip and MEMS.
Increasing shipments in smartphones and wearable electronics with more
sophisticated sensing functions further drive growth in the MEMS market.
Veeco estimates that its served available markets for advanced
packaging, compound semiconductor and MEMS are all growing at
double-digit compound annual growth rates.
Herman Itzkowitz, SSEC’s Chief Executive Officer said, “We are excited
to join the Veeco team. Veeco is a dynamic market leader in compound
semiconductor equipment for LED, power electronics, and wireless
devices. 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.”
About SSEC
SSEC designs and manufacturers wafer processing equipment for compound
semiconductor, MEMS, semiconductor advanced packaging, photomask and
other applications. SSEC provides customers with leading-edge processes,
reliability and value. All SSEC systems are engineered from the inside
out and are configurable according to customer process needs and their
manufacturing and business objectives. For more information, please
visit: http://www.ssecusa.com
Details of the Transaction
Under the terms of the agreement, Veeco has acquired SSEC for a total
consideration of approximately $150 million in cash, subject to
customary adjustments. Veeco is forecasting SSEC’s revenues to be $65
million in 2015. Given SSEC’s financial performance over the last few
years, we expect them 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.
Veeco’s Q4 2014 stand-alone performance is tracking in-line with
previously published financial guidance. However, due to SSEC
acquisition related accounting, our previously published GAAP and
non-GAAP guidance cannot be relied upon.
Management Conference Call
Veeco’s management will host a conference call to review this
transaction tomorrow, December 5, 2014, at 10:00 am Eastern time. The
call will be webcast live on the Veeco website at www.veeco.com.
The call can also be accessed by dialing 1-888-737-3662 (toll free) or
1-913-312-1507 using passcode 7022579. A replay of the call will be
available beginning at 1:00 pm ET tomorrow through Friday, December 19
at 1:00 pm ET at 1-888-203-1112 (toll free) or 1-719-457-0820, using
passcode 7022579, and on the Veeco website. A slide presentation will be
available for listeners to follow along, so please visit our website
prior to the event.
About Veeco
Veeco’s process equipment solutions enable the manufacture of LEDs,
flexible OLED displays, solar cells, power electronics, hard drives,
MEMS and wireless chips. We are the market leader in LED, MBE, Ion Beam
and other advanced thin film process technologies. Our high performance
systems drive innovation in energy efficiency, consumer electronics and
network storage and allow our customers to maximize productivity and
achieve lower cost of ownership. For information on our company,
products and worldwide service and support, please visit www.veeco.com.
To the extent that this news release discusses expectations or
otherwise makes statements about the future, such statements are
forward-looking and are subject to a number of risks and uncertainties
that could cause actual results to differ materially from the statements
made. These factors include the risks discussed in the Business
Description and Management's Discussion and Analysis sections of Veeco's
Annual Report on Form 10-K for the year ended December 31, 2013 and in
our subsequent quarterly reports on Form 10-Q, current reports on Form
8-K and press releases. Additional risks specifically associated
with this transaction relate to the expected benefits to Veeco from
completing the acquisition and the expected financial performance of
Veeco following completion of the acquisition. Statements
regarding future events are based on the parties' current expectations
and are necessarily subject to associated risks related to the potential
impact on the business of SSEC due to the acquisition, the retention of
employees of SSEC and the ability of Veeco to successfully integrate
SSEC’s market opportunities, technology, personnel and operations and to
achieve expected benefits. Veeco does not undertake any obligation to
update any forward-looking statements to reflect future events or
circumstances after the date of such statements.
Source: Veeco Instruments Inc.