If you look at the Websites for Lam Research and SEZ, you'd hardly know the two companies are now one, despite the successful closing of the tender-offer deal last week.
There's little evidence of Lam's absorption of SEZ on either website.
A headline at the top of SEZ's now-tacky looking homepage (which has become little more than a list of press release links) reads in benign capital letters, "A Division of Lam Research Corporation." A nondescript link on the lower half of Lam's minimalist opening page says generically, "Lam Research and SEZ," which links to a lonely pair of paragraphs about the acquisition. The second paragraph states the following boilerplate-worthy verbiage: "Combining our technologies and leveraging both companies' market presence and resources, enables Lam Research to more effectively and efficiently address our customers' specific applications needs and technology roadmaps. Together we offer a broad equipment portfolio and wide range of etch and single wafer clean technology solutions."
Other than the press release information about the completion of Lam's tender offer for SEZ on both sites, there are no other readily discernible deal-related revisions to the product, technology, corporate, or miscellaneous info found in any other sections---at least for now.
Yawn. If Lam wants to convey a palpable lack of excitement about bringing SEZ into the fold, and SEZ seeks to downplay its acquisition, so far, they have succeeded mightily. To call it "hoopla lite" would be an overstatement. Hype, what hype?
This lack of a corporate makeover in the Lam-SEZ collective messaging realm resonates somewhat with the few words offered to Chip Shots by VLSI Research's Risto Puhakka.
"The problem is that the only thing that really changed is SEZ became Lam," he opines. "There are still the same number of suppliers, the people are mostly the same, the tools are the same. The deal made a lot of sense for Lam, but it is not that significant from an industry perspective until we see how the wet industry changes. The big issue is that how the rest of the players react, and we will not know that for at least a year."
Gartner's Dean Freeman is a bit more expansive in his comments on the deal.
"I think the merger is good for both Lam and SEZ," he says. "SEZ gains size, and Lam can open new doors for SEZ. Lam gains an established cleaning group that can open doors for their new cleaning tool and hopefully prevent them from reinventing the wheel."
"It doesn't really consolidate the clean market as SEZ now is Lam, so the same numbers of cleaning players exist," Dean continues. "From a technology standpoint, it gets SEZ one step closer to the integration, as they now can work directly with an etch company to develop clean technology for etch processes. However, this has not benefited the TEL cleaning group in any significant way, so I don't see it as a big synergy."
In terms of the IC equipment supplier landscape, the just-released VLSI Research top 10 (really top 15) list for 2007 shows Lam securely in fifth place, about $157 million behind fourth-place KLA-Tencor. But the numbers do not reflect each company's recently completed or still-pending acquisitions: SEZ for Lam, and ICOS for KLA-T.
If we assume the successful closing of the ICOS deal and add the new unit's FY07 revenues to the KLA-T total at a dollar-to-Euro conversion rate of $1.50 per (I know, that's well under the current rate), the parent company's revenues would climb to just over $2.9 billion. If you add SEZ's FY07 sales numbers to the Lam balance sheet, after converting the Swiss francs to dollars at 1.20SF per (again, a now-obsolete rate but the one given on SEZ's reporting), this pushes the Lam hypothetical revenue line up to about $2.9 billion. So the fourth- and fifth-ranked companies on the VLSI hit parade would be in a statistical dead heat for that coveted fourth slot, given the givens.
Another tidbit from the VLSI list is that five of the top 10 companies participate in the wet and dry surface cleaning/conditioning spaces---Applied Materials, TEL, Lam, Novellus, and Dainippon Screen---although admittedly AMAT and Novellus are not major players (despite what they might tell you). Outside of the big boys, the other, smaller surface-prep tool companies like FSI, Akrion, SSEC, Mattson, et al. are coming under acquisitional scrutiny as well, now that the SEZ deal has positioned Lam as a top-tier cleans company.
SEZ brings Lam a clear edge in the back-end-of-line/interconnect single-wafer market and a strong foothold in the emerging---and increasingly critical---front-end-of-line applications space. Speaking of FEOL and the need to clean device nanostructures without damaging them whatsoever, that's one area where the Lam-SEZ combination might pay off synergistically. "The oxide and silicon loss requirements generated the most discussion of any item on the surface preparation roadmap," according to the front-end processes chapter in the new International Technology Roadmap for Semiconductors. I wouldn't be surprised to see the new union's collective brainpower and technological knowhow provide a few breakthroughs on the pre- and postgate cleans front.
Later this year, the "trade-offs between cleaning performance, substrate damage, and etching" will also be one of the main points of discussion at the biannual Ultra Clean Processing of Semiconductor Surfaces conference, taking place September 21-24 in Brugge (don't spell it Bruges), Belgium. The March 31 deadline for abstract submission to the UCPSS is approaching fast, so anyone interested in sharing their work with the global semi surface prep community should click here for more information.
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