In a bid to increase its market share in the lucrative chipmaking sector, Applied Materials Inc. announced this week that it will acquire Varian Semiconductor Equipment Associates Inc.
Bloomberg reports that the move by Applied Materials will enable the company to get back into the business of ion-implantation machinery, which is a stage in the production of all computer chips. The company had previously receded some of its market clout to Varian, according to Stifel Nicolaus & Co. analyst Patrick Ho.
Per terms of the deal, Varian will pay $63 per share in cash for a total price of roughly $4.9 billion; that figure represents a 55 percent premium on Varian's closing stock price on Tuesday, and a 38 percent premium on its 30 day average closing price. Currently, Vairan is the globe's biggest supplier of ion implementation equipment. Applied Materials chief executive Mike Splinter said the deal would help the company to expand its manufacturing clout and reach.
"Varian is a great fit for our strategy to profitably grow share in our core semiconductor business with best-in-class technology and talent," Splinter said in a statement. "Combined, Applied and Varian will be better positioned to help our customers solve ... complex challenges and deliver long-term value to shareholders."
Bloomberg reports that the move by Applied Materials will enable the company to get back into the business of ion-implantation machinery, which is a stage in the production of all computer chips. The company had previously receded some of its market clout to Varian, according to Stifel Nicolaus & Co. analyst Patrick Ho.
Per terms of the deal, Varian will pay $63 per share in cash for a total price of roughly $4.9 billion; that figure represents a 55 percent premium on Varian's closing stock price on Tuesday, and a 38 percent premium on its 30 day average closing price. Currently, Vairan is the globe's biggest supplier of ion implementation equipment. Applied Materials chief executive Mike Splinter said the deal would help the company to expand its manufacturing clout and reach.
"Varian is a great fit for our strategy to profitably grow share in our core semiconductor business with best-in-class technology and talent," Splinter said in a statement. "Combined, Applied and Varian will be better positioned to help our customers solve ... complex challenges and deliver long-term value to shareholders."
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