fei_hillsboro.JPG

At work on an FEI electron microscope at the company's headquarters in Hillsboro.

(Oregonian file photo)

FEI Co.

Business

: Electron microscopes for semiconductor companies, scientific researchers and energy companies exploring for natural resources

Employees

: 3,000, including roughly 500 in Hillsboro

Revenue

(2015): $930 million, down 3 percent

Profits

: $124 million, up from $105 million in 2014

Another of Oregon's big corporations sold Friday, with Hillsboro electron microscope company FEI Co. agreeing to sell its business to Massachusetts-based Thermo Fisher Scientific for $4.2 billion in cash.

At $107.50 per share, in cash, the sale represents a roughly 14 percent premium over FEI's share price Thursday. It's the second-biggest sale of an Oregon tech company in history, following last year's deal for TriQuint Semiconductor, which was valued at $5 billion.

"This is one that had been rumored for a couple quarters, and that actually helped the stock quite a bit," said Thomas Diffely, a senior research analyst who follows FEI for D.A. Davidson in Lake Oswego.

FEI shares already had climbed 19 percent this year and jumped to $108.13 at Friday's close, slightly above Thermo Fisher's offer price. That suggests there could be other suitors, Diffely said, perhaps including electronics instruments company Agilent or perhaps semiconductor equipment company Applied Materials.

FEI sells is microscopes to Intel and other chipmakers, to oil companies exploring for new resources, and to life sciences researchers. Life sciences are a a hot market, according to Diffely, and Thermo Fisher is taking advantage of a downturn in the other two segments by acquiring FEI now.

"A lot of established, long term companies like this have an interest in life sciences," Diffely said.

FEI has 3,000 employees worldwide - historically, about 500 of them worked at its Hillsboro headquarters. FEI refused to comment on the future of its Oregon site or work force. Diffely said administrative and marketing jobs will likely dwindle over time, but the "core engineering" will endure.

"There's a lot of key know-how there, engineering know-how, that you don't want to mess with," he said.

In a memo to employees, FEI indicates it expects Thermo Fisher will retain at least some of its workers.

"This transaction is about growth, and FEI employees will become part of a large and growing company that offers many opportunities for career development and advancement," the company wrote.

In a separate letter to employees, FEI chief executive Don Kania told workers to "stay focused on your responsibilities." FEI told workers it hasn't determined what will happen to its executive team or brand name following the deal.

The deal triggers a big payday for FEI's top executives, including $25 million for Kania and more than $9 million for the Hillsboro company's new chief financial officer.

Founded in 1971, FEI makes extremely high-powered electron microscopes for the semiconductor industry, scientific researchers, oil companies seeking new resources and others who require an extremely close-up view of the world.

FEI History

1971

: Founded in McMinnville as Field Electron and Ion Co., by faculty members at Linfield and the Oregon Graduate Center (later the Oregon Graduate Institute.)

1973

: Moves to Hillsboro.

1995

: Initial public offering, begins trading on Nasdaq.

1996

: Sells a 55 percent stake in the business to Philips Electronics.

2002

: FEI agrees to sell to a New York company, Veeco Instruments, and move its headquarters there. It was a $1 billion deal when it was announced but each company's stock slid on the news and so they called off their combination.

2006

: FEI calls off plans to sell to a German company, Carl Zeiss, after word leaks out about a pending deal. It hires Don Kania, Veeco's chief operating officer, to be CEO.

2012

: FEI buys French software company, Visualization Sciences Group, for $55 million.

After several years of robust growth, FEI's sales fell nearly 3 percent last year to $930 million. The company has been hurt by the strong U.S. dollar, which depressed overseas sales, and reduced demand from scientific researchers. It had forecast a rebound in 2016, however, and its first year of more than $1 billion in revenue.

The new owner, Thermo Fisher, has annual revenues about $17 billion and more than 50,000 employees. Its products serve scientific researchers and the medical community.

The companies said Friday's deal will expand Thermo Fisher's product line, with FEI microscopes complementing the new owner's mass spectrometry products, and will give Thermo Fisher a consistent new source of revenue from a business with high profit margins.

Bringing the two companies together will save the businesses about $80 million annually in the third year after the deal, Thermo Fisher said. It hopes to close the deal early next year.

The sale of FEI is the second big deal for an Oregon tech company this year: In February, Beaverton-based Cascade Microtech agreed to a California company called FormFactor for $352 million.

FEI was among the biggest companies remaining in Oregon following a $44 billion selling spree last year. Even big Oregon companies tend to be small by industry standards and in periods of consolidation, when interest rates are low and the economy is high, for example, the state's businesses are more likely to be sellers than buyers.

Note: This article has been updated with analyst comment and additional detail on the deal.

-- Mike Rogoway

mrogoway@oregonian.com

503-294-7699

@rogoway