Harris Sells Entire Semiconductor Business

Harris Corp. (Melbourne, FL) recently announced it is selling off its entire semiconductor business. Harris has entered an agreement to sell the division to a subsidiary of Sterling Holding Company LLC, a Citicorp Venture Capital Ltd. investment portfolio company. Harris had previously intended to sell only the power portion of the semiconductor division."Selling the whole semiconductor business and allowing it to operate as one company gives it both the size and flexibility it needs to address this dynamic industry," said Harris CEO Phillip W. Farmer. "This will provide the best growth opportunity for the business and for its employees."Other investors will include certain individuals and affiliates of Credit Suisse First Boston Corp., and Harris will retain a 10 percent position in the business. Harris will receive $700 million in cash, notes, retained receivables and contingency payments. The transaction does not include Harris' suppression business or photomask operations, which are to be sold separately. Sales of the semiconductor business were $530 million during the last 12 months. The division employs more than 6,200 people and includes the world's only 8-inch wafer power fabrication facility, in Mountaintop, PA and other fabrication and assembly operations in Florida and Ohio along with a major test-and-assembly facility in Kuala Lumpur, Malaysia. Gregory L.Williams, current President of Harris Semiconductor, will run the new spun-off business. The buyer intends to offer positions to all present Harris Semiconductor employees.