II‐VI Incorporated has acquired Kaiam Laser Limited, a 6-inch wafer fabrication facility in Newton Aycliffe in the United Kingdom. The purchase price of the transaction was $80.0 million and was paid from the Company’s cash reserves. The company now expects to breakeven the EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) level in regards to its total revenue within the next 12 months.
The 300,000 square foot Kaiam facility hosts a state of the art 100,000 square foot clean room designed for high volume manufacturing of compound semiconductor devices based on GaAs, SiC and InP materials.
The facility hosts one of the best clean rooms in the entire compound semiconductor industry and augments II-VI’s capabilities at a time when industry capacity is rapidly becoming fully subscribed. Given the demand, this acquisition will allow faster time to market than building a proprietary green field site and will enhance the company’s leadership position in the supply chain. It adds to II-VI’s in-house capacity for VCSELs, and is also as part of a broader strategic move to provide a versatile 6” wafer fab for GaAs, SiC and InP-based devices.
The acquisition is expected to significantly expand o II-VI’s capacity and enable over time to penetrate high growth markets driven by, for example, 3D sensing, 5G wireless, the electrification of the car, and data center communications.
As a part of its vertical integration strategy, II-VI is now expanding its VCSEL product family and leveraging its broad engineered materials and optoelectronic device technology platforms and manufacturing capabilities around the globe to drive scale and innovation through the development of high performance compound semiconductor devices.