About Mike

Mike Buetow is editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He is also vice president and editorial director of UP Media Group, for which he oversees all editorial and production aspects. He has more than 20 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

When Fake Buys Make Real News

M&A specialists in the electronics industry seem to have caught a case of merger mania. In the process, they unfortunately have seem to have learned the worst traits of the buyout crowd.

A pair of unsolicited bids were announced this week. In one instance, a small EMS company announced its interest in a much larger competitor. In the other, a Chinese connector manufacturer made a play for a smallish Canadian EMS/ODM.

What makes these cases interesting are the details.

In the former, Cemtrex, a company with trailing four quarter revenues of $125 million and a market cap of $31 million, made a play for Key Tronic, a top 50 worldwide EMS that reported sales of $468 million for its just completed fiscal year. Key Tronic’s market cap is $74 million, so Cemtrex’s offer of a one-for-one stock swap was a huge discount to Key Tronic’s value.

Not only that, says Key Tronic, it wasn’t really even  an offer:  “Based on (Cemtrex’s) current SEC filings, Key Tronic understands that Cemtrex has not commenced a formal exchange offer and that any such offer would require additional SEC filings by (Cemtrex),” Key Tronic said.

In the latter, Shenzhen Kaizhong Precision Technology made a written offer for Pacific Insight Electronics. The wrinkle here is, not only was Pacific Insight taken by surprise, it is already under agreement to be purchased by Methode Electronics.

The ODM today confirmed receipt of a written buyout proposal from Chinese connector maker. However, Pacific Insight has already agreed to be acquired by Methode Electronics, whose offer Pacific Insight says is superior to Kaizhong’s. Pacific immediately urged shareholders to reject the unsolicited bid.

Publicly traded companies such as Key Tronic and Pacific Insight have a fiduciary responsibility to their shareholders. However, from time to time outsiders try to make waves or generate publicity by pulling stunts like these. I’m not saying the interest communicated by Cemtrex or  Kaizhong is false, or even misplaced. But in both cases, I think the suitors are overplaying their hands.

 

Dont’ Forget PCB West Next Week!

Next week is the 26th annual PCB West, the preeminent trade show in the Silicon Valley for the electronics supply chain.

As those who have attended before know – and there are quite a few of you – PCB West focuses on the design and manufacture of PCBs, HDI, electronics assembly and printed circuit board test, and gives engineers, designers, fabricators, assemblers and managers an opportunity to improve skills, increase knowledge and network with peers, colleagues and experts. With an emphasis on training – half the presentations
are at least 2 hours in length – there is no place better to get real, practical, in-depth information.

Our three-day conference features:
• More than 70 presentations on the hottest topics, including noise control, flex circuits, and diagnosing assembly defects. This is our largest conference yet!
• More than 15 day-long tutorials or half-day seminars

• Sessions for all levels of experience and training, from novice designer and engineer to seasoned pro
• Speakers from Analog Devices, TTM Technologies, NXP Semiconductor and many more top companies
• The ever-popular Rick Hartley, Doug Brooks and Susy Webb
• An all new PCB/EMS Management track with special sessions aimed at helping executives make the capital investment and hiring decisions that shape their companies
• Three free day-long tracks on Sept. 13, with topics ranging from signal integrity and IoT PCBs to 3D printing technologies.

Also next week, a special 2.5-day IPC Designers Council Certification Program powered by EPTAC.

All conference attendees receive free admittance to the one-day exhibition Wednesday, Sept. 13, which includes a complimentary luncheon and evening reception, both on the show floor.

For more information or to register, click here.

Looking forward to seeing you at the show! And as always, please feel free to share your thoughts.

Don’t Fire Up the Grill Yet, Wisconsin

Dear Wisconsin,

I know you are excited about the news Foxconn will build a high-end display manufacturing plant in your backyard. But don’t break out the brats and beer yet, cheeseheads: Foxconn has a long track record of pulling the football away right before you go to kick it.

Signed,

Brazil

Indonesia

Vietnam

India

Phillipines

Harrisburg, PA

How Far Can We Go to Replace Lead?

The end is nigh for lead in solder, as our columnist Tim O’Neill writes this month in CIRCUITS ASSEMBLY.

Rules governing use of the materials — Directive 2015/863, aka RoHS 3 — are coming online and will be in full force by 2019.

Suppliers have until July 22, 2019 to meet the stricter provisions, which includes no more than 0.1% lead in medical devices, which are joining consumer, industrial and other electronics products on the effectively banned list.

The question Tim poses is, What comes next? Already, the future of commonplace unleaded alloys such as SAC is being questioned. As Tim writes, “It is even feasible SAC 305 will be dislodged by a new de facto alloy that better serves the needs of the market.”

A Norwegian scientist believes he may have the answer. As noted in Phys.org this week, Dr. Henrik Soensteby of the University of Oslo is working on an alternative alloy that contains nothing but common — and essentially benign — elements. In conjuring up his alloy, Soensteby is mixing sodium, potassium and oxygen with niobium, a very strong metal typically used in steel. While niobium dust is reported to cause eye and skin irritation, it reportedly is nontoxic, at least in the volumes used.

It’s not so clear yet how much niobium would be needed. Brazil is the biggest supplier of niobium, producing more than 85% of it each year. Other sources include Zaire, Russia, Nigeria and Canada. World production is relatively light: around 25,000 tonnes per year. Some scientists believe there are ample supplies still in the ground. There’d better be: Some 5 million tonnes a year of lead ores are mined each year, although obviously not all that goes into electronics.

Soensteby is optimistic he can use atomic layer deposition (ALD), a vapor phase method that uses gas at controlled temperatures to stimulate a reaction with the substrate; the output is thin films. It is an emerging technology in semiconductor manufacturing. There are many, many questions, of course. First and foremost, does the alloy actually, you know, work? Also, ALD typically involves higher temperatures than are used in electronics assembly: Would it work with today’s packaging? Will other technologies such as 3D printing or Joe Fjelstad’s solderless Occam process supplant the need for solder in any form?

Still, materials science is the most exciting area of electronics today. We may make fun of folks who walk around with smartphones seemingly permanently tethered to their ears, but we also have them to thank.

 

Register now for PCB West the Silicon Valley’s largest PCB industry trade show: pcbwest.com! Now with full-day electronics assembly tutorials!

 

So Long, Sola

I have to say, I didn’t think Jure Sola would or could last this long. The cofounder of Sanmina, Sola was one of the poster boys for wanton M&A excess, snatching up more than a dozen companies or OEM plants during the late 1990s and early 2000s. The spree culminated in the purchase of SCI Systems in mid 2001, a $6 billion deal that saddled the company with so much debt, when the ensuring tech collapse occurred, it was forced to take 20 straight quarters of “one-time” charges.

Most execs couldn’t have survived such a bloodletting. Sola wasn’t most execs, however. He continued to place his bets on fabricating in the US — in a memorable line, he told an IPC Printed Circuit Expo audience that “plating was in his blood” — and Sanmina remains the second (or third) largest board supplier in North America. Moreover, he correctly swung to the military and aerospace markets, eschewing the PCs that SCI was so dominant in.

Today the company is half the size in revenue of its peak, but consistently profitable.

Come October Sola will ride off into the sunset with his legacy intact, perhaps not the most beloved man to run a major PCB company, but a success nonetheless. In this era, that’s no small thing.

 

Green Herring

For those newbies, Bob Herring was the perfect example of good timing, building up and selling not one but two board shops. The first, Industrial Circuits, was sold in 1989 for $60 million. The latter one, Herco Technology (which we profiled multiple times in PC Fab), went for $122 million in 2000, just a year before the tech crash. (The buyer of Herco, Teradyne, closed it less than two years later. The former Industrial Circuits lasted less than one year longer before Toppan shut the doors.)

In case you were wondering where Bob went, well, he started his own network cable news channel. It now is televised in some 30 million homes.

Guess there is life after PCBs!

 

 

Ahead of Our Time?

Will Foxconn build in Wisconsin?

Its track record in India, Malaysia, and various other places says no, and according to this Washington Post reporter, “No one had gone back to see whether this had been carried through, and it hadn’t.”

Well, not no one

 

Jim Raby, RIP

I’m saddened to get the news this morning that Jim Raby has passed away. As longtime readers will know, Jim was one of my favorite persons, not just in the industry but in life. What a tremendous fighter he was for doing things right! I will always miss him. 

My sincere condolences to his wife Ellen, son David and everyone at STI on this sad day. We have lost a fine engineer, gentleman and human being.

Trolling NY

Apparently someone has decided to toy with New York state by assuming the role of “Foxconn US” and trolling a poor soul named Chris Souzzi, who works for Genesee County Economic Development Center.

I’m no fan of Foxconn, and I don’t think there’s a snowball’s chance in hell they put a plant in the Empire State, but stunts like these aren’t funny (even if that’s what’s intended) and simply go too far.

 

 

Madam President

I cannot express how pleased I am today at the news that my former colleague and (still) good friend Kathy Nargi-Toth has been named president of Eltek USA.

Kathy is one of the warmest and kindest persons I have had the pleasure of coming across, and her industry knowledge is second to none.

I wish her all the luck in the world in her new job — not that she will need it!