(EDITOR’S NOTE: This is the final 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
John Swindeman and Warren Oliver acknowledge that they had been looking for the right strategic acquirer for Oak Ridge-based Nanomechanics Inc.
“We had really been working hard for 10 years,” Oliver said. “We were reinvesting all of our profits back into the company every year.”
For a small technology enterprise, that’s clearly a big commitment.
“We believed we could be a growth play for the right company,” Swindeman told us in a recent interview. As the company’s Chairman and Chief Executive Officer, he was a point person in the exploration process, but Swindeman credits Kermit Parks, then Vice President and Chief Development Officer, for doing a lot of the background research.
“Kermit Parks’ work was critical,” Swindeman said.
The short list that they developed had four targets. Two were strategic, a third was a possibility, and the fourth was KLA. At the time, the latter’s core business was focused on the semiconductor sector; it was not in the mechanical testing business. But KLA also offered stylus and optical profilers that they sold into research markets.
“We were close to being acquired by a foreign company in October 2017,” Swindeman says. It might have been fate that the deal failed to materialize when an announcement was made just a few months later that would prove fruitful. KLA acquired the nanoindenter product line from Keysight Technologies in April 2018.
“Within two weeks, I was on a plane to meet with KLA,” Swindeman explained. “I immediately saw advantages for KLA and Nanomechanics.”
There were a number of factors that made a long-term agreement attractive to the Nanomechanics owners, starting with Swindeman’s realization that “right from the beginning, the cultural fit with KLA was obvious.”
There was also the company’s motto of Keep Looking Ahead, denoting a culture of innovation and optimism.
“KLA invests more in R&D as a percent of revenue than comparable companies in Silicon Valley,” Swindeman added. For a scientific-based company like Nanomechanics, that was important.
“KLA has reported four years of continuous record growth,” he noted.
For the local region, it’s also a win. “Everyone kept his or her job,” Swindeman said. “Our staff has already grown by 50 percent here, and a product line was moved from China to Oak Ridge after we demonstrated our operations excellence. And we hope to bring additional jobs to the region.”
“I’m excited about more, positive developments in the future for our employees and our region,” Swindeman adds.