July 22, 2004 – Ibis Technology Corp., Danvers, MA, a provider of SOI implantation equipment, has decided to discontinue its wafer-manufacturing business to focus on its SOI implant tools. The company will terminate its relationship with MEMC, its wafer sales representative, and is exploring options for a sale of the business, expecting to record it as a discontinued operation in 3Q04 with charges of $0.5-$2.5 million.
Ibis had maintained its wafer-sales business to build demand for its SIMOX SOI implantation equipment, but recognized it was marred by volatile production volumes and costs and “repeated starts and stops,” and ultimately was not profitable–and with more capital investment likely required to keep up the business, said president and CEO Martin Reid.
In the end, a recent order for Ibis’ SOI implant tool, and discussions for another likely completed by year’s end, convinced the company to “close a chapter” of drumming up support for SOI technology and “focus exclusively on our equipmnet business,” said Reid.
Bill Ong, analyst with American Technology Research, viewed the news as a positive and confident step forward for Ibis. “The $7 million [Ibis i2000] 300mm tool will immediately be profitable with 50% type of gross margins achievable without the cost of overhead of the current wafer manufacturing operations,” he said.