GOLDEN, Colo. -- Isonics Corp., a developer of isotopically engineered semiconductor materials, has agreed to buy the silicon wafer manufacturing business and related assets from EnCompass Materials Group Ltd. (EMG) of Vancouver, Washington, the company said Wednesday (March 31, 2004).
EMG manufactures silicon test wafers and provides wafer recycling services for leading semiconductor manufacturers, Isonics added.
The purchase price would be approximately $3.5 million consisting of a term note, Isonics common stock and the assumption of certain EMG liabilities. The parties expect the transaction to close in the second quarter of 2004.
"While we have been selling small quantities of thick-film SOI wafers, we were reluctant to go after larger, more valuable orders until we had established a functional manufacturing infrastructure capable of producing quality products in large volumes," said James Alexander, Isonics' chairman and chief executive officer, in a statement. "Faced with growing demand for our SOI wafers, we needed a plan which simplified and expedited this segment's transition from a development stage organization, to a high volume manufacturer. This transaction will provide Isonics with an ISO 9002 and ISO 14001 compliant manufacturing facility into which we will install our equipment and proprietary processes for producing silicon-on-insulator wafers."
EMG posted unaudited revenues of $3.8 million for the year ending December 31, 2003, which resulted in an unaudited net loss of $1.4 million for the same period.
Isonics said that with only modest increases in SOI revenue, the combined businesses should turn profitable within 12 months following closing.