GT Solar acquires Crystal Systems for cash, stock

GT Solar International Inc. said Thursday (28.07.2010) it has acquired privately-held Crystal Systems Inc., a maker of sapphire substrates used in the light-emitting diode (LED) lighting, defense, medical and aerospace industries, for about $59 million in cash and stock.

Analysts have estimated that LED market could grow up to a 40 percent compound annual growth rate over the next several years, driven by increased sales of products such as flat panel televisions and commercial and residential lighting. Sapphire is the most widely used substrate for this fast-growing market.

GT Solar will pay $24 million in cash and 5.4 million shares of GT Solar common stock currently worth about $35 million. It also will make a $21 million cash earn-out payment upon Crystal meeting certain financial and technical targets.

"We expect to capitalize on the attractive opportunities we have identified in equipment, LED, and high tech specialty markets that require high-quality, low cost crystalline substrates," said Tom Gutierrez, GT Solar´s president and CEO.

Fred Schmid, founder of Salem, Mass.-based Crystal Systems, will join GT Solar in a senior technical capacity. GT said Crystal Systems is a profitable company with expected revenue of about $16 million for the 2010 calendar year. The deal is expected to add to earnings by the end of fiscal 2012.

GT Solar leaders will discuss the deal further during an earnings call scheduled for Aug. 5.

Shares of GT Solar rose 24 cents, nearly 4 percent, to $6.49 in midday trading.