US-based GT Solar bought itself a place in the burgeoning market for energy-efficient lighting technology late last week, announcing its acquisition of light-emitting diode LED substrate manufacturer Crystal Systems.
GT Solar paid $57.8m 36.3m in a mixture of cash and stock for the 40-year-old company, which makes sapphire, a substrate commonly used in LED systems. Crystal's founder, Fred Schmid, invented the heat exchanger method, which the company uses to produce larger sapphire crystals.
The deal will strengthen GT Solar's position as a supplier of manufacturing technologies and components to clean tech firms.
The company has established itself as a provider of production equipment and engineering packages for the photovoltaic and polysilicon manufacturing sectors. However, the Crystal acquisition gives it a foothold in what analysts suggest will be an increasingly lucrative market as LED manufacturers continue to expand. In particular, LCD manufacturers are fuelling demand for LEDs as a lighting source to replace their traditional cold cathode fluorescent lamp displays.
Speaking in February, Bob Steele, director of optoelectronics at market research firm Strategies Unlimited, predicted a 53 per cent growth in the high-brightness LED market in 2010, which would place its total global value at $8.2bn.
The market is expected to enjoy a compound annual growth rate of 30.6 per cent for the next five years, he added, bringing its value to $20.2bn in 2014.
Crystal Technologies has revenue of about $16m per year and is expected to add to GT Solar's operating income over the next 18 months, according to reports.
GT Solar will discuss the acquisition in depth during its earnings call on Thursday, but the market clearly welcomed the move; GT Solar's shares leapt almost five per cent after the news broke early on Friday morning.
