Trumpf acquires laser diode division of Philips

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Trumpf is acquiring 100 per cent of Photonics GmbH from Philips, headquartered in Ulm, Germany. The move, which represents Trumpf's largest acquisition since buying JFY in China in 2013, opens up a new market segment for Trumpf to complement its existing high-power diode laser business. Laser diodes from Philips Photonics are used, for example, in smartphones, in digital data transmission, and in sensors for autonomous driving. 

The news follows Philips Photonics announcement at the end of last year that it had shipped one billion VCSELs. The cumulative milestone came after two years of significant growth in demand for vertical cavity surface emitting lasers (VCSELs), driven by trends such as the introduction of proximity sensing and 3D face recognition in smartphones. Apple’s iPhone X has a VCSEL built in for face ID.

Philips Photonics, which employs around 280 people, doubled its production capacity for VCSELs at its Ulm, Germany facility in 2017, and then doubled the capacity again in 2018. The company now plans to double this a third time within the next 18 months.

Trumpf invested almost €340 million in research and development in the past fiscal year 2017/18, corresponding to a development ratio of 9.5 per cent.

'With this acquisition, we want to open up new product fields and expand our existing portfolio at a strategically important point,' said Trumpf boss Nicola Leibinger-Kammüller. Through the acquisition, Trumpf will expand its access to fast-growing markets in the photonics and digital products sectors.

'Philips Photonics employs a large number of very good developers who have opened up new areas of photonics and who will strengthen our research and development area in the long term. Together we want to further develop the Photonics division,' added Lars Grünert, member of the group management board, responsible for the new Trumpf product field and Chief Financial Officer.

Philips Photonics is headquartered in Ulm, Germany, where the laser diodes are also manufactured in a high-tech facility. Further locations are Aachen, Eindhoven in the Netherlands, and sales offices in Shenzen, Shanghai, and Qingdao in China. 

VCSEL production at Philip's facility in Ulm. Credit: Philips Photonics

'Since our foundation in 2000, we have grown strongly. More than half a billion cell phones worldwide are equipped with laser diode technology from Philips Photonics,' said Joseph Pankert, business leader of Philips Photonics. 'We are very excited to become part of Trumpf. This will ensure that the division can continue to grow in a highly innovative company in the future,' Pankert continued.

The transaction is expected to be completed in the second quarter of 2019. Both companies have agreed not to disclose the purchase price. 

With the VCSEL laser diode, the light is emitted perpendicular to the plane of the semiconductor chip, in contrast to the edge-emitting laser diode, where the light exits at one or two edges of the chip. VCSEL diodes are inexpensive to manufacture.

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