30 July 2015

AXT acquires InP substrate maker Crystacomm

AXT Inc of Fremont, CA, USA - which manufactures gallium arsenide, indium phosphide and germanium substrates and raw materials at its facilities in Beijing, China using its vertical gradient freeze (VGF) technique - has acquired privately held firm Crystacomm Inc of Mountain View, CA, USA - which manufactures indium phosphide (InP) substrates using the liquid encapsulated Czochralski (LEC) crystal growth technique - in an all-cash transaction.

AXT says that indium phosphide is rapidly emerging as a material of choice for both new and existing applications, including optoelectronic devices for fiber-optic telecommunications, passive optical networks (PON) and data-center connectivity, as well as solar cells and next-generation wireless amplifiers. Crystacomm was the first firm in the industry to introduce 2-inch, 3-inch and 4-inch InP substrates, and is described as having been a leader in the development of 6-inch InP technology, which has the capability to support the stringent requirements of 5G wireless communications.

"This technology acquisition is highly synergistic to our current InP business and provides further competitive differentiation and cost benefits," says AXT's CEO Morris Young. "It allows us to broaden our technology base, and gives us the flexibility to serve customers with varying technical requirements," he adds. "While we are not expecting revenue from the acquisition in this calendar year, we believe that the additional capabilities will provide valuable and incremental business opportunities for AXT in the years to come."

While still relatively small, the InP market has seen considerable growth over the last two years, driven by fiber-to-the-home (FTTH) network deployments that are actively occurring worldwide, says AXT. For example, China, Singapore and Taiwan have invested heavily in nationwide PON, and network deployments are ongoing in countries such as Australia and New Zealand.

The landscape of InP substrate providers has been limited as a result of the relative technical difficulty in producing substrates that meet the stringent specifications for various optoelectronic and electronic applications. AXT says that it has worked collaboratively with customers to overcome these challenges and has developed robust proprietary manufacturing processes, resulting in significant market share in this expanding market.

The terms of the acquisition (which closed in the second quarter) are not being disclosed. The crystal-growth equipment and processes will be installed in AXT's Fremont facility. Crystacomm's founder & CEO George Antypas will stay on as a consultant to AXT, assisting it in bringing up the Crystacomm LEC-InP crystal growth and poly-synthesis process.

"George's groundbreaking research enabled the early commercialization of InP, and Crystacomm has been at the forefront of the technology progression ever since," comments Young. "We are pleased to bring this valuable technology into our portfolio."

Tags: AXT InP

Visit: www.crystacomm.com

Visit: www.axt.com