Entering CEO honed the dragging company's strengths, spearheaded acquisitions and brought it to a $600 million IPO.
BOSTONWhen Christine King came on board as president and chief executive officer of AMI Semiconductor Inc. in 2001, she found a company adrift, with no exciting technology, no profits and no strategic plan to pull it out of the doldrums.
It was a company without direction, King said.
"The company had a past, it was surviving in the present, but where was its future?" said King, speaking here at the Silicon East Summit on Wednesday.
In her keynote address, King laid out the key steps along the route that brought the Pocatello, Idaho, company from that point to its $600 million IPO two years later, in September 2003. She did so for the benefit of several small, New England-area companies and startups in the semiconductor space, some of which were pitching their businesses to the venture capitalists in the crowd.
For Kingwho came to AMI after 23 years with IBM, including several years elevating its merchant chip business to the No. 1 spot worldwide, with $1.7 billion in revenueit was a mixture of changing the 38-year-old companys culture, focusing on its strengths, creating a strategic direction and making a couple of timely acquisitions that put the company back on track. And the weakened economy didnt hurt, giving AMI time to make the necessary changes and creating an environment conducive to acquisitions.
"The key was finding out what can this company be a leader in," King said.
As far as AMIs products, its core competencies included solid engineering and strength in the mixed-signal space, she said. With that in mind, King said, executives decided to focus on three verticalsautomotive, medical and industrialfor their products. Still, AMI needed to increase its customer penetration and its global presence.
In 2002, the company bought STMicroelectronics, Alcatel S.A.s mixed-signals division, a unit generating $100 million in revenue that AMI got for $75 million. AMI then bought Microsemi Corp.s Micro Power Products Division, a mixed-signal unit focusing on the medical space.
The purchase of the Alcatel unit grew AMIs core competency and gave it a stronger presence in the European marketa region that now accounts for 40 percent of the companys revenue, King said.
AMI replaced every top-level executive who was reporting to the CEO when King took over, promoted "hidden stars" within the company and hired talented outsiders, she said. King then took her message directly to AMIs 2,554 employees via such avenues as meetings and roundtable discussions.
The results have been rapid revenue and customer growth in the three target areasthe company sells 64 components to the automotive industry and has 34 customers in the medical fieldas well as 20 percent growth in revenues during 2003, a return to profitability and $47 million in annual cost savings.
"I think the reason we were able to rebuild this company was due to the fact that we set bold objectives and expectations that this could be a great company," King said.
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