The Finisar Corp. production facility in Sherman could see the addition of 200 workers from the company’s Allen facility by the end of the year.
During a ribbon cutting event for the local facility in July, Finisar CEO Michael Hurlston told the Herald Democrat he had informed staff in Allen that eventually their 160,000-square-foot facility will be shuttered and moved to the nearly 700,000-square-foot building in the former MEMC building on Sherman’s south side. Finisar Sherman General Manager and Vice President Jeff Brown said in December that could happen by the end of this year.
“We are planning to move the Allen operation to Sherman by the end of 2019 or beginning of 2020,” Brown said via email last month.
Hurlston previously stated Finisar plans to make Sherman the “VCSEL Capital of the World.” In July, Hurlston said the Sherman facility “has plenty of room to house” the equipment in the company’s Allen plant.
“What we’ll do is all the equipment from Allen that’s dedicated to our old optical networking business, we’ll keep dedicated to that and then all the equipment that’s here (in Sherman) that’s new — that’s called the six-inch production line — will be on these new consumer applications,” Hurlston said.
Finisar announced in December 2017, it would hire 500 new employees to expand its production of vertical-cavity surface-emitting lasers at its new Sherman facility to help meet Apple’s demand for the technology in its iPhone line. VCSELs are small semiconductor devices that emit light vertically and measure the depth at which that light is reflected. That depth-sensing technology helps power Apple product features such as facial recognition, portrait mode selfies and proximity-sensing capabilities.
In addition to the numerous smartphone applications, Finisar Executive Vice President and General Manager of 3-D Sensing Julie Eng previously said VCSELs could soon be put to use in new markets such as medical and manufacturing, to make vehicles safer for drivers and other motorists and even in vacuum cleaners and lawnmowers.
“We’re trying to go into these more consumer applications and without (the) Sherman (facility), we simply can’t do that,” Hurlston said in July. “What happens is our old business, which is the laser business and optical networking, typically you think of an order of hundreds of thousands of units in a month. The volumes are big, they’re substantial, but when you talk about these consumer applications, you’re talking millions of units even a week, so the numbers are wildly different. And in order to deliver that kind of scale, we need a factory like this — a bigger factory that can deliver that kind of capacity.”
Brown said in December the company has hired 250 employees and expects more will be added as the facility moves toward commercial production. The company shipped out its first samples in the fall. Brown said Finisar’s total investment in the Sherman facility is expected to be approaching $200 million by the end of 2019.
“The factory space in Sherman has been completed,” Brown said via email. “We are now focusing on adding office space and modernizing the existing office space. We expect to continue some level of construction through most of 2019.”
In November, it was announced Finisar is to be acquired by global manufacturer of engineered materials and optoelectronic components II-VI Incorporated in a deal worth about $3.2 billion. In a teleconference call held following the announcement, Hurlston said he believes the combined company will have substantial growth potential.
“By joining II-VI, I’m confident that we’ll be able to accelerate our growth in ways that neither of our teams could achieve as independent companies,” Hurlston said. “Further, we believe this transaction represents a compelling value composition for Finisar shareholders as it delivers immediate cash value while providing the opportunity to participate in the significant upside potential of our combined organizations once the transaction is completed.”
The definitive merger agreement, which has been approved by the boards of both companies, states II-VI will acquire Finisar in a cash and stock transaction that will see Finisar’s stockholders receiving, on a pro-rated basis, $15.60 per share in cash and 0.2218 shares of II-VI common stock.
Brown didn’t directly address any impact the potential acquisition by II-VI would have on the Sherman facility, but indicated VCSEL production will continue locally.
”As we have communicated to our employees, we continue to believe that Sherman is a world class facility and is expected to deliver high volume VCSEL output for years to come,” Brown said.
During the teleconference call, II-IV President and CEO Vincent D. Mattera Jr. said the merger will create a formidable photonics and compound semiconductor company.
“We believe that combining with Finisar will enable us to be even more effective as we accelerate the development of our portfolio of products in the emerging markets of 5G, 3D sensing, cloud computing, electric and autonomous vehicles and advanced microelectronics manufacturing,” Mattera said.
Mattera said the combined company plans to utilize its existing operations to the best of their capabilities. Once the transaction closes, Finisar and II-VI will have over 24,000 employees in 70 locations worldwide. Finisar Director of Corporate Communications Victoria McDonald said, in a prepared statement issued via email at the time of the announcement, the company expects the transaction to close in the middle of 2019, subject to approval by each company’s shareholders, antitrust regulatory approvals and other customary closing conditions.