Schlumberger Looks To Spin-Out Semi Test Business
By Jeff Chappell -- 10/31/2001
Electronic News
dg> I believe Schlumberger was the primary maker of testing equipment used with Rambus
www1.slb.com
www1.slb.com
www1.slb.com
slb.com
BALTIMORE-Jean-Luc Pelissier, vice president of Schlumberger Ltd.’s Semiconductor Solutions division, which encompasses its semiconductor test, diagnostic and telecommunications businesses, confirmed today the company is preparing to spin its test business out of Schlumberger, rather than continue to try and find a buyer.
Pelissier said the company has set no firm date, but did say that it wouldn’t occur before the second quarter of 2002.
This decision comes nine months after its New York and Paris-based parent company (nyse: SLB) said it planned to divest San Jose-based Semiconductor Solutions and its seven business units to concentrate on its oil field services business. The company sold one of these business units, its automated systems unit, to Cohu Inc. last July. Schlumberger originally announced its intent to divest its semiconductor subsidiary early in the year during its acquisition of IT services company Sema plc.
Ever since, the divestiture of Schlumberger’s automated test equipment (ATE) and diagnostics business has been the focus of many rumors. All of the major ATE companies have been rumored at one point or another to be in the process of buying some or all of the businesses. There were even published reports that front-end equipment giant Applied Materials Inc. was considering buying Schlumberger’s test units.
Many ATE executives here at the International Test Conference this year, while reluctant to speak on the record, confirmed that all of the major ATE companies at one time or another considered the possibility of an acquisition of Schlumberger’s test units. In fact, Pelissier said some 120 various companies looked at acquiring the various seven businesses that made up Schlumberger Semiconductor Solutions. "We got a lot of offers," he added.
But Schlumberger set strict guidelines for any potential sale, Pelissier said. Any potential buyer must provide the right valuation for the business units, and must also prove to be a good fit for the business units, and honor Schlumberger’s commitments to its customers, he said.
"It was difficult to find a home for these seven businesses that would have same passion for them (as Schlumberger)," said Pelissier, who was in charge of overseeing the divestiture.
Aside from those guidelines, the downturn played a role in Schlumberger’s test businesses being on the auction block so long. While there have been some interesting acquisitions in 2001 in the world of test, executives here noted that it takes a strong cash position to acquire a large company, and that it is difficult at best, even when times are good.
Pelissier also noted that the feedback it was getting from customers and potential buyers was that going it alone might be the best option for everyone involved. So the company switched gears, and feels it is in a good position for an eventual spin-off.
Although Schlumberger doesn’t break out revenues from its test businesses from that of its other businesses, Pelissier said Schlumberger has invested more money back into Semiconductor Solutions this year than it did last year.
"We’re not looking like a company that wants to shut down," he said. The company is committed to holding onto its test and probe systems businesses as well as its SABER services business while it bides its time until market conditions are more hospitable to an initial public offering (IPO).
Schlumberger still is still looking to sell its telecomm and verification business units, and expects to announce a sale of its yield enhancement business unit by the end of November, Pelissier said.
Although the company lost some market share in the recent past when Intel Corp., one of its two major customers, decided to pursue structural test after championing functional test for years, Semiconductor Solutions has a strong position in logic and system-on-a-chip (SOC) test. It has made a splash with its low-cost structural testers, as well, with an installed base that already numbers 35 systems. The company has apparently even won over Intel once again with its structural tester.
"We are in a very privileged position," Pelissier said. "It is encouraging us to perhaps pursue the divestiture in a different way," he said of the IPO. "We have a strong story … there is no reason why we should not be able to do it," he concluded. |
