SDL Buys Polaroid's Fiber Laser Business

By: Kristin Lewotsky

As part of its strategy to consolidate its position in the industrial laser market, SDL Inc. has purchased the Massachusetts-based fiber laser business of Polaroid for $5.0 million. The purchase covers physical assets, the ongoing operation of the fiber manufacturing facilities and fiber laser subsystem business, and all intellectual property, including the assignment of 38 patents and the licensing of 22 patents in the fiber laser area.

The acquisition is not surprising, as the two companies have collaborated on fiber laser manufacturing for seven years. Polaroid primarily provided the fiber technology, while SDL produced pump lasers and built the integrated systems. Initially, SDL produced the fiber lasers exclusively for Polaroid. In 1997, SDL commercialized the technology, releasing the 9-W FL10 laser for marking and texturing applications. Simultaneously, Polaroid released the FL10 under its own name in the laser printing market.

Plans call for SDL to administer the Polaroid business as a separate division under the leadership of current head Steve Abbey; it will not be combined with SDL's fiber laser business. According to SDL president and CEO Don Scifres, the company has no plans to make any changes to the Polaroid business, and operations will continue in the Cambridge, MA plant. "They'll be doing the same things that they did prior to the acquisition, and SDL will continue to manufacture the fiber laser here in San Jose," he said,

As part of the transaction, SDL and Polaroid have entered into a multi-million dollar, multi-year exclusive supply agreement for the supply of advanced fiber laser subsystems to the Polaroid Graphic Imaging Division of Polaroid Corp. SDL expects the acquisition to be accretive to earnings per share in 1999, after estimated one-time charges of approximately $2.5 million in the quarter ended March 31, 1999.