Applied Materials acquires rival Tokyo Electron for $9.39 billion

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Chip-making tools producer applied supplies is acquiring Tokyo Electron Ltd., a rival maker of apparatus for production of semiconductors, flat panel displays and sun panels.

The 2 firms mentioned Tuesday their $9.39 billion all-stock transaction will result within the creation of a brand new firm with a market capitalization of about $29 billion.

Tokyo Electron’s chairman Tetsuro Higashi said the deal is supposed to create a “actually global company” to satisfy the wishes of companies presenting consumer electronics such as smartphones and pills.

The new company can have shared leadership, with Higashi as its chairman and applied supplies’ president and CEO Gary Dickerson as its CEO.

Applied materials’ shareholders will own about 68 % of the brand new company and Tokyo Electron’s will grasp about 32 %. the 2 firms are expecting the deal to be finalized in the latter 1/2 of 2014.

The businesses said they plan to conduct a $three billion inventory repurchase program within three hundred and sixty five days of the deal’s completion.

Tokyo Electron’s revenue has stagnated previously few years because of weaker demand from chip makers.

 

 

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Author: Rohit Shetty

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