SANTA ROSA – Long-time Santa Rosa tech company Thermal Technology LLC has been sold six years after it was purchased from founder George Johnson. This time it was acquired by a New Hampshire maker of solar and LED equipment.
GT Advanced Technologies Inc. (Nasdaq: GTAT) picked up the closely held, private Thermal from partners Matt Mede and Dr. Harald Holzgruber to expand its own markets, said GT president and CEO Tom Gutierrez.
Earlier this year GT laid off 170 employees, about a fourth of its 680 global workforce, because of falling solar prices and weakened markets for LED.
The company’s revenues slid from $353.9 million in the first quarter of calendar 2012 to $57.8 million in the same period of 2013. Annual revenues dropped to $733.53 million in 2012 from $873.44 million in 2011.
[caption id="attachment_73804" align="alignleft" width="315"] A crystal and 90-kilogram sapphire crystal boule produced by Thermal Technology’s equipment and used for LED substrate production.[/caption]
“Now we can offer customers a wider range of product options best suited to their specific production environments. This will enable us to compete for incremental business in areas where we would have previously been unable to offer a product," said Mr. Gutierrez of the acquisition.
Thermal is expected to bring in revenues of $7 million $14 million, but more important are its close to 50 products, which include high temperature furnaces and sapphire crystal growing machines. The latter are highly prized by developers of LED lighting and electronic device touch screens.
“We identified and targeted Thermal as an acquisition because of the synergies between their product line and ours,” said GT director of marketing Jeff Nestel-Patt.
The current executive team will remain in place, he said, and no layoffs are planned.
“Our idea is to grow the markets they’ve been supplying and develop new ways to commercialize their technology,” said Mr. Nestel-Patt.
During the past two years Thermal supplied nearly 300 crystal growing machines to its Asian customers, nine in China and others in Taiwan and South Korea. The company saw a fourfold spike in revenues to close to $60 million during that period, according to then president and CEO Matt Mede.
Demand has since leveled off, but Pacific Rim countries are expected to lead the touch screen market.
Thermal also recently added a very new technology with applications for both the aerospace and automotive industries: spark plasma sintering.
The process creates an ultra-dense material without using an external heating source. Traditional densification requires heat treatment of 2000 degrees, so the Thermal equipment is considered highly advantageous. The material is used for hypersonic vehicles such as spacecraft, so the equipment is expected to give GT an entry into the aerospace market.
“With both the technology and the analytic tools that come with it, we feel very confident in our ability to grow this segment,” said Mr. Gutierrez.
According to Mr. Mede, the acquisition will open new opportunities for growth for 70-employee Thermal.
"Leveraging GT's leadership in engineering and product development and their strengths in low-cost global supply chain management will accelerate the time-to-market of our technology and drive market adoption in several promising markets as we go forward,” he said.