Alfred,
When I bought ATMI over 2 years ago, I did extensive research into this area and related technologies and companies as well. I also came across Crystallume. As I remember, Crystallume was into diamond coating of tools until the diamond technology was sufficiently advanced for other applications. They were also featured in a Forbes article in the Fall of 1994. I wasn't impressed with them, because they were a one product/technology company, and were also having financial problems. They were delisted later in 1995, because they didn't have enough cash to meet listing requirements. I don't know if anything has changed, or if they have any solid products or customers now.
During this time I also checked out Cree (CREE), SI Diamond (SIDT), Applied Science & Technology (ASTX), Pixtech (PIXT), SDL (SDLI), Ibis (IBIS) and a few others I can't recall right now. All of the above were ATMI competitors in niche markets (or in SDL's case, a collaborator), but none had the breadth in all the niche markets that ATMI did. ATMI was the only one of these companies I invested in. All of the above were into new, cutting edge technologies. At that time, I didn't know which technologies would succeed and which wouldn't - this sector is somewhat speculative. So I felt that ATMI was a good way to minimize that risk, since they covered many bases, not just one or a few. And besides, ATMI had superior management that knew these areas well (founders came from American Cyanamide).
If you look at the performance of the above companies, you will see that ATMI has far outperformed all of the above companies, and most of the companies mentioned above have a much lower valuation than they did 2 years ago.
I have always viewed these cutting edge materials companies as biotech-like. They have a cash burn until they bring a product to market, and their products are also somewhat protected by their patent portfolio, as it seems to be much harder to engineer around materials patents than it is applications (electronic products) patents. ATMI also had an edge in this case, since it could use revenues from its cash cow Ecosys division to finance R&D operations for its bleeding edge technology divisions. ATMI also had excellent collaborative arrangements, better than the others, in my opinion. Another biotech-like property.
Patient investors in ATMI have been rewarded well.
Regards, Christina Young |
