II-VI Incorporated is expanding a factory for compound semiconductors used in displays, laser sensors, and radio frequency devices. The company, based in Saxonburg, Penn., expects four times the number of chips will leave the new plant by 2020.
The factory under renovation is located in Campaign, Ill., and is operated by Epiworks, a chipmaker that II-VI purchased for an undisclosed sum in February. Epiworks is known for manufacturing epitaxal chips out of extremely thin layers of semiconductors like indium phosphate and gallium arsenide. Both are critical building blocks for optical and wireless chips.
Before it acquired Epiworks, II-VI built other semiconductors in the arcane field of electrical materials, including silicon carbide and zinc sulfide. Vincent Mattera, II-VI's chief executive since September, has followed his predecessor Francis Kramer in laying ambitious plans for new technology.
The company is building clean rooms in Illinois for new manufacturing tools but also a special laboratory for testing wafers. And renovating a chip factory is not to be taken lightly. The facility must be designed to be extremely clean, free of even a single speck of dust that can corrupt a chip’s circuits.
After the Epiworks deal closed, the company ordered three new specialized semiconductor machines that filled the available space in the Illinois plant, according to Quesnell Hartmann, one of the co-founders of Epiworks, in a recent statement. “These systems have already been installed and we have now moved into the next phase of growth,” he added.
The renovations are scheduled to be finished in mid-2017. In the meantime, II-VI is hiring engineers and plant managers to help run the bigger facility. The new hires will oversee the production of devices based on indium phosphate, or InP, and gallium arsenide, or GaAs. The products will include optoelectronic parts for data centers, semiconductor lasers, and specialized chips for 5G wireless infrastructure.
While most chipmakers contract foundries to manufacture chip designs, II-VI has expanded its manufacturing operations in recent years. Before it signed the deal with Epiworks, it also bought Anadigics, a maker of compound semiconductors for wireless chips, for $78.2 million. The deal ended a surprise bidding war between an unidentified Chinese firm and GaAs Labs, the holding company for Macom.
II-VI disclosed in a recent government filing that it had sold some of Anadigics’ radio frequency technology for around $45 million. But the company kept Anadigics’ manufacturing plant in New Jersey, which had produced GaAs wafers measuring six inches. II-VI plans to build optical components known as vertical-cavity surface-emitting lasers with the old equipment.