(EDITOR’S NOTE: This is the first article in a two-part series that is focused on another technology company in the Oak Ridge-Knoxville region that experienced a successful transition in the past year.)
By Tom Ballard, Chief Alliance Officer, PYA
We were introduced to Oak Ridge-based Nanomechanics Inc. in 2012, soon after we launched teknovation.biz, and published the first of more than a dozen articles about the technology company in August of that year.
Founded as Nano Instruments Inc. in 1983 by Warren Oliver and John Pethica, the company was acquired in 1998 by MTS Systems Corporation and again in 2008 by Agilent Technologies of Santa Clara, CA, just at the beginning of the “Great Recession.” Soon after the latter acquisition, the company reorganized as a contract manufacturer for Agilent.
Now, more than a decade later, the owners could not be happier that Nanomechanics has been acquired by KLA Corporation that develops industry-leading equipment and services enabling innovation throughout the electronics industry. The transaction was completed last July.
“It’s a great win for our employees,” said John Swindeman, Nanomechanics’ former Chairman and Chief Executive Officer, who now serves as Business Unit Director for KLA. “As we hit our quality, operating costs and talent recruitment goals, there will be more business coming to this region.”
The Oak Ridge-based company produces a variety of products that help scientists and engineers evaluate and understand the mechanical performance of their materials on micrometer to nanometer scales.
We sat down recently with Swindeman and Oliver to discuss the journey for the company through the various acquisitions and divestitures. One thing was clearly emphasized throughout the interview: being part of KLA bodes well for the company, its former owners, and its employees.
Oliver, now Senior Scientist at KLA, co-founded the original company in the basement of his home with a focus on commercializing a tool to measure the mechanical properties of thin films. The technology had been developed by Oliver and Pethica while Oliver was a post-doc in Switzerland. (EDITOR’S NOTE: We chronicled the company’s early days in a series that also published in 2012. Click here to read Part 1 and here for Part 2.)
For Oliver, Swindeman and fellow owner Kermit Parks, the acquisition of their company by KLA was also a reunion of sorts.
“KLA put us back together with this acquisition,” Oliver told us. That event occurred when KLA acquired Keysight Technologies’ nanoindenter product line in April 2018, and then acquired Nanomechanics in July 2018.
Today, Oliver repeatedly says that he’s having fun.
“I’m focused on technical things . . . working on projects that are really cutting edge, such as very high strain rate testing of materials,” he told us. It’s clearly the type of work that he finds most enjoyable.
“We still collaborate with great scientists around the world like George Pharr,” Oliver added, referring to the former Director of the Joint Institute for Advanced Materials at the University of Tennessee, Knoxville and now a Distinguished Research Professor at Texas A&M University. He was at Nanomechanics the day we conducted the interview.
KLA’s acquisition of Nanomechanics was one of a number of transitions in the region in the last 18 months. On the high end, you have Discovery Communications Inc.’s $14.6 billion acquisition of Scripps Networks Interactive Inc. and Berkshire Hathaway Inc. purchasing 38.6 percent of Pilot Travel Centers for $2.76 billion with plans to eventually own a majority stake.
Others include Integra LifeSciences Holdings Corporation announcement just a few weeks ago that it has acquired Arkis Biosciences; Genera’s announcement in mid-July that it has secured a more than $118 million equity investment, anchored by WindSail Capital Group; Sunstone Partners, a private equity firm, acquiring Sword & Shield Enterprise Security Inc.; Cubic Corporation acquiring GRIDSMART Technologies Inc. (see our article here); Clovis Point Capital LLC making a significant investment in Cirrus Insight (see our article here); Domtar Corporation acquiring a majority stake in Prisma Renewable Composites LLC (see that announcement here); and K1 Investment Management’s significant investment in PerfectServe Inc.
These sorts of transactions don’t happen by accident. They take time, patience, and a strategic focus. How did the Nanomechanics and KLA agreement come about?
NEXT: Swindeman and Oliver share the journey.