Whither Goest Sokudo?

Will Sokudo Co. Ltd. (Kyoto, Japan)
continue to compete in the track business dominated by Tokyo
Electron Ltd.? (Update: The company announced its twin-track
Sokudo Duo system on April 21st, after this blog was first
published.)

Formed three years ago, on July 3,
2006, Sokudo is 52% owned by Dai Nippon Screen and 48% by Applied
Materials. The two companies signed a deal to
attack the track market with a joint venture that rolled
DNS’s track business together with $150M and other inputs
from Applied. The target was to take share away from the de facto
monopoly TEL holds in the (normally) highly profitable track
sector.

Sokudo has found it more difficult
than expected to gain traction. With the current downturn causing
many companies to reevaluate their activities, DNS and Applied are
reconsidering how they proceed with Sokudo.

A spokesman at DNS in Kyoto said
while the original agreement had a three-year period, the joint
venture agreement “does not automatically expire. There has
been no change in the status of the joint venture.” An
Applied spokesperson said much the same thing, noting that the
relationship does not dissolve after three years.  

However, the Sokudo spokesman did
draw attention to a line in the company’s recent financial
results statement of Feb. 9th, which said that DNS would
conduct “a sweeping review” of Sokudo. The press
release said the Sokudo joint venture is “under planning for
reconstruction,” and the results would be announced in May.
With DNS sustaining deep losses in its fiscal 2008, losing
$391M for the year, one can only speculate how the companies
will proceed with Sokudo.

On March
31, 2009 – the end of the fiscal year — DNS announced a management change
at the joint venture. Takashige Suetake, an executive vice
president at DNS, gave up the top job at Sokudo. He was replaced as
Sokudo CEO by Tadahiro Suhara, a former president of DNS
Electronics. 

With a promised update in May, it
will be interesting to see if Sokudo gets a new infusion of talent,
cash, and commitment. The company has sponsored one of the most
important lithography events at SEMICON West, its annual breakfast
which attracted speakers from Intel, the top scanner makers, and
other companies. (Update: The Sokudo breakfast is now set for July
15 at Semicon West 2009.)