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20 December 2007


Filtronic sells Compound business

Wireless electronics manufacturer Filtronic plc of Shipley, UK has announced a definitive agreement for the sale of Filtronic Compound Semiconductors Ltd (FCSL) to RF Micro Devices Inc of Greensboro, NC, USA for £12.5m.  The transaction is expected to complete on 29 February.

The sale price of £12.5m is higher than anticipated when Filtronic announced at the end of November that it would sell its compound semiconductors business for no initial payment (apart from the potential for deferred payment depending on the achievement of certain performance targets).

RFMD was FCSL’s biggest customer until, in late June, it announced the termination of an outsourcing deal for gallium arsenide pseudomorphic high-electron-mobility Transistors (pHEMTs) switches from September (due in part to RFMD increasing its in-house pHEMT switch production).

The sale agreement provides for ongoing supply to Filtronic’s Point to Point business for at least 3 years and for the FCSL fab (Europe's main 6-inch GaAs wafer foundry) remaining at its current site in Newton Aycliffe, County Durham, UK.
The gross value of FCSL’s assets as at 31 May 2007 was £23.5m, with underlying losses before exceptional items (attributable to the assets for the year ended 31 May) of £1.5m and a headline loss including exceptional items of £29.0m. 

Filtronic says that, following completion of the deal, it will cease its activities in compound semiconductor manufacture and supply. FCSL will enter into a supply contract and lease, including provision of support services, to Filtronic’s Point to Point business.  The proceeds of the sale will be retained within Filtronic’s general corporate resources.

See related items:

Filtronic returns to short-term profit

Filtronic negotiating sale of compound semiconductors division

Filtronic forecasts return to profit this year, pending sale of Compound Semiconductors division

Filtronic to cut 115 jobs as RFMD decides to cease buying GaAs pHEMT switches in September

Filtronic confirms cut in compound semi capex due to lower-than-expected demand

Search: Filtronic GaAs pHEMT switches RFMD