Consolidation continues to happen in the global semiconductor equipment industry, this time with Applied Materials, the biggest of the bigs and a Silicon Valley stalwart for decades. Applied has announced its merger with Tokyo Electron Company, with Applied’s CEO slated to run the company.
Tokyo Electron, known usually just as TEL, is the firm that roughly a year ago acquired Chaska-based FSI International for $252.5 million.
Chaska-based FSI International, one of the Twin Cities oldest computer technology companies, has come to the end of its 39-year streak of independence.
Tokyo Electron Limited has made a $252.5 million tender offer for FSI, which makes computer chip manufacturing equipment. Founded in 1973 by Joel Elftmann, now retired, FSI was able to ride on the shoulders of the metro area's big computer firms of the 1960s and '70s -- Control Data, Honeywell and Sperry Univac (now Unisys).
"Those companies drove an understanding of how to manufacture computer components," said Benno Sand, FSI's executive vice president of business development and investor relations. "We've continued to leverage that."
But FSI is finally bowing to the reality that, in today's world, you have to be big to compete.
As a relatively small company with annual revenue in fiscal 2011 of $96.9 million, and 400 employees, FSI had not been able to sell to computer chip industry giants such as Intel, Sand said. "If a company such as Intel is going to make an investment in very expensive equipment for the next chip technology, they want to work with a larger company that has global resources it can bring to bear when there's a problem," Sand said. "Even though FSI has good technology, at our size we don't have those resources around the world."
The acquisition by Tokyo Electron, which has annual revenue of $8 billion, "was an opportunity for FSI be part of larger organization with larger resources," Sand said.
Donald Mitchell, FSI's CEO, called the transaction a "compelling opportunity" for the company's shareholders, employees and customers that combines the "market position, scale and operational excellence" of Tokyo Electron with FSI's leading-edge technology.
Expensive new iPhone outselling cheap new one 4 to 1 – Quartz
For migrants, new land of opportunity is Mexico – NY Times
Target, other retailers monitor Bangladesh protests – MPR
U.S. home price increases slow in July – Reuters
It’s possible some of the Kenya attackers are from Minnesota – StarTribune
Univ. of Toronto students bid for highly-sought-after classes – Toronto Star
Letterman: Minnesota’s top 10 least successful businesses – StarTribune
Rejoice. A full album of Bach on mandolin by Chris Thile – WSJ
Life coaching booms in China – Financial Times
Caterpillar stuck between Midwest lawmakers, Australian iron mine – Journal Sentinel
Timothy Beardson has a new book (reviewed here) on China's future, and he told the Economic Club of Minnesota in its first luncheon of the fall that China’s severe demographic problems will usher in a period of want -- pretty much no matter what.
Once China’s population peaks in the late 2020s, he said, and begins to fall dramatically over the rest of the century, the nation will struggle to maintain economic growth.
“When China looks at the other challenges that it has in front of it, whether it’s cleaning up the environment, whether it’s trying to build an innovative education system or a functional financial system, it really needs to address those much-needed areas while it still has decent levels of economic growth,” Beardson said.
“It’s going to be a lot harder in ten years’ time to be dealing with some of those issues,” he said. “So I think that there’s a call for urgency amongst policymakers in China which we simply haven’t been seeing.”
I tried to summarize parts of the speech here: http://bit.ly/15pju73
China is Minnesota's second-largest export market.
Obama's reach-out to Iran -- saying recent overtures from Iran may offer a basis for a “meaningful agreement” to resolve confrontation over its nuclear program -- helped send Benchmark oil for November delivery down to the lowest close since July 30: $103.13 a barrel.
And just when it seems corn can't go much lower, it does. With harvest starting and prices so low, timing their sales will be more important than usual for farmers.
The day started off quite busily with a lot of news flow this morning.
Heading in to the 4 p.m. meeting with editors from around the newsroom, Strib Biz editor Todd Stone is advising the staff that he's looking at good placement for stories about the Applied Materials takeover of Tokyo Electron, which affects workers at Tokyo's Chaska unit that used to be FSI International, the GMO labeling discussion at the General Mills meeting and the big real estate deal for the old State Farm site in Woodbury. You can also look out for a story on the chase to get ADM to move its headquarters to the Twin Cities -- online tonight and in print tomorrow.
Be sure to read the chat with David Phelps about the Petters saga conducted online earlier this afternoon. After we finished, Dave said we could have gone longer. We'll plan more in the future.
BREAKING -- Hazelden-Betty Ford details
More from the Hazelden-Betty Ford joint news release:
The combined entity will constitute the largest nonprofit addiction treatment provider in the country.
Together, the new organization will offer residential and outpatient services based on its Twelve Step, abstinence-based treatment model for individuals suffering from addiction, their families and other loved ones, at 14 sites across the U.S. Also under the aegis of the new Foundation will be Hazelden’s addiction and recovery publishing house (the nation’s largest), a fully-accredited graduate school of addiction studies, an addiction research center, a prevention training program, along with Betty Ford Center’s education arm for medical professionals and its unique Children’s Program.The agreement to merge now forges the way for the regulatory approval process, with the goal of completing the merger by year’s end. Under the terms of the merger agreement, the new entity will be named the Hazelden Betty Ford Foundation.