Micron, Altabancorp vs. Gunther Family, and More (The Week-in-Review, Mar. 12-19, 2021)
Top Biz news in Utah this week includes a surprise announcement to sell the IM Flash plant in Lehi, the emerging fight for control of Utah’s largest community bank, and a lot more
What started with great fanfare and a multibillion-dollar commitment some 16 years ago, is now coming to a surprise end as Micron Technology announced this week it is selling its 2.4 million square foot semiconductor plant in Lehi, Utah.
In November 2005, two of the leading semiconductor companies on the planet — Intel and Micron — shocked Utah and much of the technology world when they announced a joint venture named IM Flash Technologies and plans to build a state-of-the art fabrication plant in the northern foothills of Lehi.
Terms of the JV saw Micron with a 51% ownership position and Intel at 49%, with a total financial commitment between them of $5.2 billion.
So … billions of dollars and several years later, IM Flash opened its doors and began manufacturing computer memory chips known as NAND flash technology.
Several years later, IM Flash expanded its Lehi operations in 2011 with next-generation semiconductor manufacturing capabilities, with an additional expansion occurring in 2017.
Then Micron announced in October 2018 its plans to buy Intel out of the IM Flash joint venture, which it did on Halloween day in 2019 to the tune of $1.5 billion in cash and the retirement of $1 billion in debt.
Yet just over a year later, this happens? Wow! Talk about a shocker.
According to Micron, the company is already in discussions with several potential acquirers, and the planned sale is expected to close by the end of 2021.
The Fight Formally Begins: Altabancorp vs. The Gunther Family
As of today, any chance that the brewing tussle might be calmed between the Gunther Family Trust and American Fork-based Altabancorp is now out the window as the Gunther family has now filed a formal “Vote No” letter with the U.S. Securities & Exchange Commission (SEC).
The upshot of the March 15th letter (found here) is to urge other Altabancorp shareholders to join the Gunther family in a “Withhold the Vote” campaign in connection with the bank’s upcoming Annual Meeting slated for April 27th, an effort intended to eventually remove certain members of the bank’s Board of Directors
{NOTE — I first reported on this brewing brouhaha between Altabancorp and the Gunther Family Trust in late January with this issue of Deseret Business Watch: A Battle for the Soul of Altabancorp. If you’d like background into what I believe is going on here, I invite you to give this edition a quick read.}
In response to the updated Form 13D Filing made on Monday by the Gunter Family Trust, Altabancorp responded with a news release the following afternoon titled “Altabancorp™ Comments on Gunther Family 13D Group Statements.”
On the surface, the Altabancorp news release is quite reasonable as it plainly lays out what it feels are its successes under the leadership of its current executives and board members over the past three years.
But as outlined in the Gunther family letter, and as reiterated when I spoke earlier today with family representative, Dale O. Gunther, the Altabancorp board “won’t meet with us.”
Specifically, the Gunther family claims that its efforts to meet with the entire board have been thwarted and called “distracting” in a letter the family claims to have received from the company.
So … what’s gonna happen? I suspect this matter is about to get a lot messier before it’s all settled.
FYI: The Gunther Family has apparently hired MacKenzie Partners, a New York City-based law firm that specializes in “proxy fights” which appears to be exactly where this is headed — for a fight.
St. George RV Firm Acquired by Camping World
On first read, I blew-off this news announcement: An RV dealership got acquired in St. George, Utah. Who’s gonna care?
Except when I went back and actually dug into the story, I realized there’s more here than met the eye.
So … in summary, Camping World (NYSE:CWH) announced earlier in the month that it has acquired St. George-based Nielson RV.
Officially, financial terms of the agreement were not disclosed.
However, the Nielson RV news release does disclose the following details:
Both Nielson RV dealerships (in St. George and Hurricane, respectively), as well as its RV storage facilities, were included in the sale;
All assets, inventory, land and improvements were included in the sale;
The “historical value” of the inventory was pegged at $20 million;
The Nielson RV land and buildings were valued at $12 million;
Although it’s a look-back estimate, 2018 revenue was expected to hit $50 million; and
Scott Nielson (100% owner of Nielson RV) plans to use the proceeds from the sale to start a “family office” investment company named Red-Sand Capital.
Without actually looking at the books of Nielson RV, it’s hard to know what the final sale price was of the firm.
But my guesstimate puts it somewhere between $25 million to $40 million, maybe more.
DeepSee.ai Lands $26.2 Million in Series A Funding
On Monday, Salt Lake City-based DeepSee.ai announced it has closed a $26.2 million round of Series A funding.
San Mateo, California-based ForgePoint Capital was the lead investor on this $26.2MM raise and was joined in the round by Salt Lake City-based venture capital firm, Signal Peak Ventures, and AllegisCyber Capital, a San Francisco-based VC. In total, DeepSee has now raised a $30.7 million.
DeepSee has created an Artificial Intelligence software engine to help organizations more efficiently and accurately wade through reams of disparate data to not only make better decisions, but to also make such choices faster and (if needed) ensure compliance with legal and/or regulatory requirements.
For example, in a Case Study on its website, DeepSee refers to work it completed with one of the world’s largest banks. The bank’s challenge was that it was taking it too long to perform after-the-fact reviews/reconciliations of its trades of securitized and OTC derivatives, often with high error rates.
After deploying DeepSee’s AI platform on this trading data, the bank saw the following results:
Average time to review each transaction dropped 30X: 2—3 minutes vs. 60—90 minutes;
Number of transactions reviewed/day jumped 10X: 60/day vs. 6/day; and
Average review time period occurred 80% faster: 5 days post-transaction vs. 30 days post-transaction.
In order to help prospective customers understand what it is they can do for them, DeepSee has coined a new term for this type of analytics: Knowledge Process Automation (or KPA for short).
It’s a bit of a mouthful, but I like it.
NOTE: From a marketing and sales standpoint, if you’re truly doing something new, often the best approach is to define the new “bucket” you’re working in, especially if what you have uncovered is what authors, W. Chan Kim and Renée Mauborgne, describe as a “Blue Ocean.”
That said, what I found as the most interesting datapoint within the news release announcing the Series A funding is the WHY behind ForgePoint Capital’s decision to invest in DeepSee.
Specifically … ForgePoint’sManaging Partner, SeanCunningham, explained
“This investment in DeepSee accelerates the ability to reduce risk with business automation …”
In other words, everything else is secondary to ForgePoint; it’s all about reducing risk in the AI sector. And THAT I find very interesting.
Bottom line: Kudos to the entire DeepSee team for landing this new capital.
Other News Items of Note from This Week
What follows below are six additional Noteworthy News Items taken from the breaking news announcements that hit our radar this past week from Utah’s business community, news items we thought you might find worthwhile if not also intriguing.
Case in point —
Homie Plans to Add 1,000 Real Estate “Buyer” Agents — in 2021
Midweek this week, South Jordan-based Homieannounced it plans to hire 1,000 new real estate agents focused on the buyer-side of the home-selling process. According to its news release, Homie currently has close to 450 employees. So in other words, it’s gonna more than double its headcount in a year.
I don’t care who you are, but doubling your number of employees in 12 months is plain hard. Period.
That said, if they’re successful, look out: Homie will upset the proverbial “apple cart” in every market that it’s in. And today, that’s Utah, Nevada, Idaho, Colorado, and Arizona.
So good luck, Homie. You’re gonna need it.
Cricut IPO News
A few weeks back I reported that South Jordan-based Cricut had filed a confidential S-1 Registration Statement with the SEC. In plain English, Cricut planned to “go public,” but at the time, it wanted to keep the details about its plans secret.
This week the details are no longer hidden, and you can get the full story behind Cricut’s forthcoming IPO here.
Simply put, the company is looking to raise between $265 million and $290 million through its public offering. I plan to take a deeper dive into the details at a future date.
Swell Raises a Series A Round of Funding
Cottonwood Heights-based Swell announced this week it has closed on an $8 million round of Series A funding. Swell provides a suite of a Software-as-a-Service marketing and sales tools for what it calls “location-based businesses” (aka, retail offices for businesses ranging from restaurants to auto repair shops to dentists, among others). Looks interesting.
I LOVE this meme, BTW! Nicely done, Swell.
UVU's Cybersecurity Program is Tops in the Country
A week ago today, Utah Valley University popped out a news release touting the fact that students from its National Security Studies program had just won First Place in the prestigious Cyber 9/12 Strategy Challenge.
The Cyber 9/12 Strategy Challenge is described as
“ … a one-of-a-kind competition designed to provide students across academic disciplines with a deeper understanding of the policy challenges associated with cyber crisis and conflict. Part interactive learning experience and part competitive scenario exercise, it challenges teams to respond to a realistic, evolving cyberattack and analyze the threat it poses to national, international, and private sector interests.”
The UVU team bested Ph.D. and graduate students from such notable universities as American, Columbia, Duke, Georgetown, Tufts, and New York, as well as West Point, the Air Force Academy, and the Naval Academy. Well done, Wolverines!
MountainAmerica Credit Union Ranked #1 by the SBA — in Utah and Nationally
The news release headline says it best: “MountainAmerica Credit Union Named #1 Lender in the Nation and Utah by the Small Busines Administration.” Pretty straightforward as far as I’m concerned. Congrats, MountainAmerica!
ICYMI: The “Tastes of Success in Rural Utah” Feature Story
Consider this a postscript, but on Tuesday I took another deep-dive into Rural Economic Development in Utah. And this go-round was a bit more encouraging. Hence, if you haven’t read this yet, I invite you to check out this second of an ongoing series on this topic here: “Tastes of Success in Rural Utah.” Thank you.
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About the Author
David Politis is a Marketing Mercenary, which is a fancy way of saying that organizations and individuals hire him to solve their marketing problems. To learn more, please feel free to visit David’s LinkedIn Profile or the website for his business: The David Politis Company. If you have a story idea for him (or would just like to connect), you can reach him at me@davidpolitis.com.