“It’s a great thing for the company and for Santa Cruz,” said Charles Hicks, Interphase chief executive officer and board chairman. “The last several years have been difficult for small companies, including ours, so, we’ve had to be very careful and slow as far as introducing new products. Now we’re going to have the funding and marketing muscle to go like gangbusters after new products.”
If approved by private Interphase shareholders and regulatory agencies, the deal is expected to be finalized within a month. The financial terms of the pending deal were not disclosed. Under the terms of the deal that was signed Monday, the small operation will remain in Soquel with Hicks at the helm and other key personnel remaining on board. In fact, there are no immediate plans for layoffs, according to Hicks and a Garmin spokeswoman.
“We’re going to gear up and do the R&D,” Hicks said. Hicks flew to Miami this week for the annual Miami International Boat Show where he was first approached a year ago by Garmin people interested in product collaboration. An ebullient Hicks said he signed the deal the day after getting married in Seacliff. He said he was having a really good week.
“I’m as happy as a lark,” he said. “It’s pretty exciting. Everything’s coming together.”
Garmin Santa Cruz Inc. will be a California corporation and an indirect wholly owned subsidiary of Garmin Ltd., one of the top three players in the navigation market. About 2,500 people work in Garmin’s U.S. headquarters in Olathe, Kan.
“Interphase’s technology is a great complement to Garmin’s growing marine business,” said Cliff Pemble, president and chief operating officer of Garmin. “Like Garmin, Interphase shares our passion for innovation and support, and we feel that this transaction further solidifies our commitment to the marine market. By adding Interphase’s talents and technologies to the Garmin family, we believe we can leverage our areas of expertise into products that can greatly enhance a boater’s experience on the water.”
In the long run, product manufacturing may not remain local, but Hicks said he is confident that research and development will prosper, especially with the creative brain trust at local marine research facilities like the Monterey Bay Aquarium Research Institute and UC Santa Cruz.
“We’re located on the Monterey Bay; it’s an incredible testing ground,” Hicks said. “The idea is that they can have a sonar research and development center right here on the bay. I think Garmin Santa Cruz is going to have a big impact on Santa Cruz over the years.”
Hicks and his late wife, Sharon Hicks, co-founded the company in 1986 and focused on products using a unique technology for “phased array scanning sonar.” While sonar systems typically track just the ocean below a vessel, this pioneering technology provides acoustic beams that scan the environment providing a virtual picture of the passage ahead of a boat.
About 40,000 fishermen, search and rescue teams, cruisers and sailors, who need to navigate fog-shrouded channels and detect sandbars, reefs, uncharted rocks and shoals, have bought the phased array scanning devices. “Always Think Ahead” is one of the company’s slogans.
The collaboration will mean that Interphase products will be integrated into Garmin’s 100 percent touch screen product line with a simplified interface.
“That’s the reason Garmin got interested in us,” Hicks said. “That technology has a lot of legs.” The company recently announced an iPhone and iPad app for the technology.
Industry reaction has been positive, said Carly Baltes, Garmin spokeswoman.
“It complements our navigation system,” Baltes said. “His technology is really cool and people are hoping some company can make it easier to use and to market it. People see the possibilities.”
The deal means that Garmin will soon have “a new and unique arrow in its quiver” of marine network sensors, Ben Ellison, a blogger with Yachting Magazine, wrote this week. “It’s not just that Garmin will market the Interphase technology better, but that the technology will no doubt be easier to use and to afford when integrated with Garmin displays. It will probably work better, too.”
Garmin Ltd., a publicly owned company founded in 1989, is incorporated in Switzerland with principal subsidiaries in the U.S., Taiwan and the U.K. In addition to marine products, Garmin designs, develops, manufactures and markets handheld and fixed-mount products for auto, mobile, outdoor, fitness and general aviation markets.
Shares of Garmin Ltd. were unchanged Friday at 44.18.
AT A GLANCE
Interphase Technologies Inc.
WHAT: A privately held technology company that designs and manufactures sonar-related images of underwater landscapes in front of a vessel.
CLIENTS INCLUDE: Dave’s Albacore of Santa Cruz, West Marine, Los Angeles City Fire Department, New York Metro Police Scuba Team, Gulf of Mexico Shrimp Net Boats, Cruising Power and Sailboats, Bristol Bay Alaska Herring Fishermen.
HEADQUARTERS: 2880 Research Park Drive, Suite 140, Soquel
BACKGROUND: Founded in Santa Cruz in 1986 by Charles and the late Sharon Hicks
LEADERSHIP TEAM: Charles Hicks, chief executive officer, chairman and majority shareholder
EMPLOYEES: 13-15 employees
CONTACT INFORMATION: 477-4944; www.interphase-tech.com/
FORECAST: Sales are significantly up from a year ago, Hicks said.
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