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June 24, 1997updated 05 Sep 2016 12:30pm

US SUPPLIERS SCRAP NEGOTIATIONS WITH SUBMICRON OVER DEBTS

By CBR Staff Writer

A group of five US equipment suppliers have finally called off their joint efforts to negotiate with Thailand’s Submicron Technology PCL over unrecovered debts. The group, which has been working together as a committee for some time, announced that they had failed to negotiate a satisfactory payment regime and they were now seeking to protect their interests by acting separately. As reported last week (CI No 3,184) Submicron owes debts to various US and European suppliers totaling around $190m. The company, which is part of the Alphatec Electronics PCL group, is trying to construct a wafer-fabrication plant in Thailand. In its last full year to December 1996 it announced losses of $20m. The five US companies involved in negotiations are Applied materials Inc, GaSonics International Corp, LAM Research Corp, Novellus Systems Inc and Silicon Valley Group Inc. As a result of the breakdown in talks, each of the suppliers will be taking substantial bad debt write-offs in their coming quarterly results. Applied Materials said it would be taking a pre-tax charge of at least $16m but against mid-term profits to date of $131m, the write-off won’t be a disaster. Applied Materials is also trying to reclaim stock bound for Thailand, currently stranded in warehouses in the US, Europe and Israel.

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