SANTA BARBARA, Calif.-Superconductor Technologies Inc. announced it will close its Sunnyvale, Calif., facility and lay off 20 percent of its work force as part of a cost-reduction program intended to lower its breakeven point.
The Sunnyvale facility will be consolidated into STI’s Santa Barbara facility. Additionally, STI will lay off about 50 workers, or 20 percent of its work force. Also, the company will implement a new, lower cost wafer deposition process called Reactive CO-Evaporation (RCE) as part of the consolidation process. STI expects most of the $3.7 million restructuring charges to occur in the second quarter.
“We anticipate being able to achieve savings of approximately $1.7 million per quarter through this program,” said M. Peter Thomas, president and chief executive officer. “We feel these actions will allow us to use our cash more effectively, and coupled with our recently strengthened balance sheet, improve our financial flexibility. We believe we are better positioned now to restore profitability more quickly.”
Separately, STI said the underwriters of its recent offering of 20 million shares of common stock have exercised in full their option to purchase an additional 3 million common shares, bringing the total offering to $18.4 million, and net proceeds for STI to $16.8 million.
