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RADFELD, Austria, Nov. 17 - A pair of leading semiconductor gear makers, BE Semiconductor Industries and Datacon Technology, will merge in January, the firms jointly announced today.

Besi will assume 100% of Datacon's shares. Datacon shareholders will receive 90% cash and shares in Besi. The purchase price was 3 million euros and includes net financial liabilities.

Negotiations are in the final stages, the companies said, and the merger is scheduled to close in January, pending antitrust and other reviews. Besi is listed on Nasdaq and Euronext. After the close, Datacon will become an wholly owned subsidiary of Besi.

Datacon makes microchip assembly platforms (die bonders), while Besia manufactures semiconductor assembly equipment.

Huntington Beach, CA, Nov. 17 -- SolderMask Inc. will become the first North American licensee of DEK's VectorGuard stencils.

Under the agreement, SolderMask will manufacture VectorGuard stencils from foil blanks supplied by DEK and will also provide complementary frames.

CHANDLER, Ariz., Nov. 8 — Microchip Technology, a provider of microcontroller and analog semiconductors, will in January convert its product packaging to lead-free plating, to comply with pending government regulations.

The company has selected matte tin as its plating material. The finish makes the company's products compatible with tin-lead soldering processes and higher-temperature lead-free processes.

The company has been shipping parts with matte tin plating in volume for over a year, Microchip said.

A number of semiconductor suppliers have announced plans to convert their line cards by the end of the first quarter 2005. See the story in the December issue of Circuits Assembly, coming soon.

MOORPARK, CA, Nov. 17 -- CTS Corp., a manufacturer of components and provider of electronics manufacturing services, will acquire SMTEK International in a cash and stock deal worth about $107 million.

CTS will pay between $14.20 and $15 per share, 75% in cash and 25% in CTS common stock, for SMTEK. CTS will also assume about $15 million in outstanding debt of SMTEK. Shares of SMTEK closed yesterday at $2.41 and the company's 52-week high is $7.50.

The acquisition is subject to shareholder approval and is expected to close in the first quarter 2005.

Upon completion of the deal, SMTEK will merge with CTS' EMS business unit, Interconnect Systems. The combination is expected to significantly expand the operational footprint, customer base, and capabilities of both businesses in the EMS market. The companies had combined revenues of about $625 million over the past 12 months.

In a press statement SMTEK chairman James Burgess said, "This acquisition ... recognizes [SMTEK's] achievement in emerging as a successful, effectively managed business with a strong competitive presence in the EMS industry. We feel the result will be significant business and financial benefits for both companies."

Elkhart, IN based CTS had revenues of $521 million over the past 12 months. SMTEK had sales of $102.4 million and operating earnings of $4 million

The companies will hold a conference call today at 1:30 p.m. Eastern: 800-762-6067 (480-629-9566, if calling from outside the U.S.). No access code is needed.

SAN FRANCISCO, Nov. 10 -- The Wall Street outlook for Sanmina-SCI is improving but the EMS firm has a long way to go before convincing analysts that it has turned the corner.

In a research report released today, Deutsche Bank said, "We have become more optimistic about Sanmina`s longer-term strategy, but believe the company must clear several near- and long-term hurdles before it warrants a premium valuation to its peers. Most importantly, we believe Sanmina`s short-term margin targets will prove aggressive."

Sanmina-SCI has set a goal of 10% revenue growth for fiscal 2005, a target DB calls "achievable." The investment bank "continues to question" Sanmina-SCI's margin forecasts, however, saying "management`s forecasts for its components business are particularly aggressive."

Sanmina-SCI cut its revenue estimates from original design manufacturing (ODM) services to $150 million to $200 million next year. Last year, the company forecast ODM sales would be $500 million by 2005.

HERNDON, VA, Nov. 12 — Makers of consumer electronics are planning full compliance to new environmental mandates from Europe by the third quarter of 2005, with some early adopters ready by this year. The supply chain is prepared to support this schedule, NEMI said today.

The trade group is basing its findings on a recent RoHS/lead-free summit at which scores of company's traded insights on the European Union's Restriction on Use of Certain Hazardous Substances and Waste from Electrical and Electronic Equipment (WEEE) directives.

The meetings were held October 18-20 and drew close to 190 people.

One primary concern: how companies will be able to prove compliance -- to regulatory bodies and to their customers. The directives are not explicit on this point, and the EU's Technical Adaptation Committee, responsible for providing guidance on RoHS implementation, has not yet made recommendations, NEMI said in a press statement.

Among the attendees' recommendations:

Executive support is required for a successful company program.
Each firm should appoint a project manager and develop an implementation plan that includes in-house efforts as well as supply base.
Many major OEMs plan to convert to Pb-free solder and components during the first three quarters of 2005 for their consumer products (some are targeting the end of this year.)
Much of the supply chain is prepared to support this conversion schedule.
Many producers of high-end exempt products will convert to Pb-free components at the same time, and then convert to Pb-free solder at a later date.
All major OEMs are requiring new part numbers for Pb-free components (in order to clearly differentiate "leaded" parts from Pb-free).

Breakout groups then explored potential areas of industry collaboration. Among the ideas:

A 10-step "best practices" program that would help companies demonstrate due diligence to remove RoHS-banned substances from products.
An industry-wide depository of component material data.
Coordination between parallel efforts, and education on approaches/best practices.
Processing and reliability of Pb-free and mixed-metal technology for high-end electronics (which are exempt from some of the directives' requirements).

Presentations from the summit and reports from the breakout groups are available at www.nemi.org/newsroom/Presentations/RoHS_summit.html.