Akoustis Technologies, Inc. announced that it has acquired Grinding and Dicing Services, Inc. (GDSI), a U.S.-based provider of premium back-end semiconductor supply chain services. Akoustis’ acquisition of GDSI is expected to support a strategy to reshore its packaging of XBAW filters to the United States and to support its anticipated application for funding under the CHIPS and Science Act. 

U.S. Senator Charles Schumer said, “Today’s announcement that Akoustis is bringing new job-creating semiconductor technology back to America, and specifically to upstate New York, is another example of the economic benefits made possible by my CHIPS and Science Act. Akoustis’ new capabilities will both enhance and expand the Finger Lakes region’s semiconductor industry, which is already home to unique assets in the semiconductor packaging space.”

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Akoustis hosted an investor call to discuss the acquisition of GDSI and provide a business update and outlook, followed by a Q & A session.

The rationale for the acquisition and expected benefits include:

  • The addition of a diverse, high-margin premium services business that is immediately accretive to our operating model. The gross margins of this new business unit are projected to be approximately 60 percent
  • Achievement of $1 million in cost savings/avoidance related to RF filter prototype activity within the next 18 months
  • Strategic alignment with Akoustis’ strategy to leverage the CHIPS Act of 2022 to create new jobs as we reshore core packaging capabilities from Asia to an advanced packaging center located on our Canandaigua campus in upstate New York. Specifically, this acquisition allows the opportunity to scale-up our back-end core competencies including wafer grinding and Stealth Dicing® process capabilities supporting our CSP and WLP onshore package manufacturing
  • Driving improved rapid prototype and development cycle time for Akoustis XBAW® filters through back-end process integration and supply chain efficiencies
  • Integration of onshore front-end and back-end supply chains supporting national security
  • New, synergistic sales channels in the defense market, including an active “Trusted Supplier” accreditation with the Department of Defense
  • The addition of the GDSI management team along with significant technical talent in wafer grinding and dicing to complement Akoustis’ front-end XBAW technology
  • The expansion of XBAW® RF filter margins through the internalization of the grinding and dicing process supply chains.

Jeff Shealy, founder and CEO of Akoustis, stated, “I am pleased to welcome Joe Collins along with the entire GDSI team to the Akoustis family. We look forward to expanding our internal supply chain capabilities and supporting the growth of GDSI’s business with external customers.” Mr. Shealy continued, “The acquisition of GDSI will enable Akoustis to speed the development of our leading XBAW® filters to take on the rapidly expanding demand for BAW filters that operate at frequencies above 3 GHz.”

Financial Terms

Akoustis is paying $14 million in cash and $2 million in stock for GDSI, with an additional $4 million in the form of a secured promissory note payable over 3 years based on key employee retention and agreed upon performance, for a total of $20 million. In connection with the transaction, and as an inducement for employment, the company granted to Mr. Collins 242,235 shares of common stock, with an additional 242,235 shares issuable on the second anniversary of the transaction and 121,118 shares issuable on the third anniversary of the transaction, subject to certain employment conditions.