When the year began, the Dutch lithography giant appeared to be well on its way to buying San Jose-based SVG in its quest to become the largest semiconductor lithography supplier in the world. Disclosed in the fall of 2000, the deal was for $1.6 billion in ASML stock.

First came the regulatory delays. A series of unexpected U.S. reviews centered on SVG's defense-related lens technology, then a last-ditch campaign by opponents attempted to derail the deal by sending out a controversial video tape of experts who came out against it.

After an unexpected delay of several months, ASML finally made a deal with the U.S. government, led the White House, by promising to try and sell SVG's lens-polishing Tinsley Laboraories division to the U.S. company. By late December, it was able to sell the defense-related part of Tinsley Labs to SGG Precision Optronics.

But by the time the purchase was completed in May, semiconductor capital spending had taken a sharp turn downward as the chip recession began to hit hard. The resulting collapse of the lithography gear markets forced ASML to accelerate the consolidation of SVG businesses in the U.S. and to slash 1,400 jobs worldwide--17% of its total workforce.

At the same time, SVG''s problems in shipping its new generation of 193-nm steppers to Intel began to interfere with ASML's plans. In late November, the Dutch company finally gave up on SVG's Micrascan V tool and said it would combine all 193-nm wavelength efforts on its own dual-stage Twinscan platform. "It is very important for ASML to concentrate our talent and leading-edge technology on one platform," declared CEO Doug Dunn at the time of the phase out of the SVG 193-nm system.

ASML's move to standardize on a single 193-nm platform could help the company compete against rivals Nikon and Canon. Indeed, ASML seemed to be still in the running for Intel's huge 193-nm lithography business, although a year-ago this contract appeared to be already locked up by SVG.

(Return to 2001 Top 10 list).