StockerYale sells laser business to Calif. firm

StockerYale Inc. is getting rid of a key part of its business, the Salem, N.H.-based company announced Wednesday.

The maker of photonics products is selling its North American laser assets – about half of the company in terms of revenue – to Coherent Inc., a laser technology firm, for $15 million in cash and about $7 million of StockerYale’s debt

The deal – which would leave StockerYale with assets in Ireland and England — raises questions about the fate of the workforce in Salem and Montreal, but those questions weren’t being answered on Wednesday. Tim Losik, the firm’s chief operating officer and chief financial officer, did tell NHBR that what remains of StockerYale will remain “a U.S.-headquartered company.”

Coherent, based in Santa Clara, Calif., is an industry leader, with more than $750 billion in assets and $700 million in sales last year. In comparison, StockerYale has $26 million in assets and $32 million in 2008 sales.

Both companies are struggling, however. Coherent lost $31 million in the last three quarters of the year and had to lay off about a fifth of is workforce. But that still leaves a company with more than a $500 billion in equity. It also recently settled a Securities and Exchange Commission investigation into derivative trading and stock options timing that resulted in restatement of earnings.

StockerYale, which has suffered a decade of losses — $2.3 million in the first half of this year — has been loaded with debt and was delisted from the Nasdaq stock exchange.

In its last quarterly filing, it put stockholder equity at $360,000. The company has repeatedly warned that it may not continue as a going concern.

In announcing the deal, Coherent said it was interested in StockerYale’s technology.

“In acquiring these two product lines, we gain access to the machine vision market and expand our bioinstrumentation opportunities through the laser diode module business,” John Ambroseo, Coherent’s president and chief executive, said in a statement. “We also add core fiber technology, which will improve our time to market and enhance both the performance and reliability of our fiber-based product platforms.”

“It’s a great deal for (Coherent),” said Larry Solow of CJS Securities Inc., who follows Coherent stock. “They pick up this tiny little company for next to nothing. It gives them access to some other technologies. Coherent will be well placed when the economy recovers.”

Whether that means it will expand and enhance the New Hampshire operations or simply use StockerYale’s intellectual property was not clear, said Solow.

According to the company’s SEC filings, StockerYale employed 183 people as of March 2009. It’s not certain how many employees the firm has now or how many are working out of Salem. It is also not clear whether the company will retain Salem as its headquarters.

The remaining StockerYale facilities in Ireland and England deal with LED and photonics products, respectively.

“With increased focus, we are confident that we can improve both growth and profitability of these two businesses,” said Mark W. Blodgett, chairman and chief executive of StockerYale.

StockerYale shares closed at 15 , down a penny, at the end of trading Tuesday. Coherent stock closed at $25.98, up $1.10. – BOB SANDERS/NEW HAMPSHIRE BUSINESS REVIEW