Applied Materials’ (AMAT) all-cash acquisition of Semitool Inc. has closed. Around 94% of Semitool shares have been offered for purchase and accepted. Applied Materials intends to buy up any additional shares as may be offered at the same price of $11 per share.

With the FTC and the Justice Department terminating the waiting period under the Hart-Scott Rodino Act last week, the company had only to pay out the agreed $360 million to close the acquisition.

Applied Materials, which so far supplied equipment for chip fabrication, will now acquire an important position in the fast-growing packaging segment as well. The acquisition is expected to bring savings to customers, which should strengthen its position in the mobile devices market (smartphones, notebooks and so forth).

Semitool’s expertise in copper interconnect systems will be a big positive for Applied Materials. The toughest competition in this market has come from Novellus Systems (NVLS) and Applied Materials itself, so the acquisition will reduce the amount of competition in the market.

Since back-end operations almost always face pricing pressure, Semitool has historically maintained its market position by offering its products at a significantly lower cost. However, the technology has started fetching better prices now and recent results have benefited from customers such as Advanced Micro Devices (AMD), Micron Technologies (MU) and Nanya/Inotera. The acquisition by Applied Materials will also expand Semitool’s customer base, as Applied will be in a position to offer a more complete solution.

Applied Materials’ equipment, service and software products are also used for flat panel displays, solar photovoltaic cells, flexible electronics and energy efficient glass. In addition to semiconductor manufacturing, the acquisition will also further its efforts in the development of solar photovoltaic cells, since Semitool has developed an important tool for the market and has several others in the pipeline.

Zacks Investment Research

1. (AMCC) Applied Micro Circuits Moving SteadilyApplied Micro Circuits (AMCC) earlier reported revenues of $49.2 million from continuing operations in the...
2. (AMAT) Applied Materials Beats on Revenues and MarginsApplied Materials’ (AMAT) fourth quarter earnings beat the Zacks Consensus Estimate by 12 cents. Revenue...
3. (HUBB) Hubbell Incorporated Closes Burndy AcquisitionHubbell  Inc.(HUBB) announced the closure of the FCI Americas (Burndy business) acquisition yesterday. The company ...
4. (AMCC) Profitability Improves at Applied Micro CircuitsApplied Micro Circuits Corp. (AMCC) recently reported revenues of $45.1 million in its fiscal first...
5. (AMAT) Applied Materials Beats – very strong balance sheet with a very small amount of long term debtApplied Materials Leaves Worst Behind Applied Materials‘ (AMAT) fiscal third quarter EPS beat the Zacks...
6. (APSG) Applied Signal Technology, Inc. – Momentum – Zacks Rank BuyApplied Signal Technology, Inc. (APSG) is rallying in response to the company’s excellent first-quarter results....

Search Posts by Tag: Advanced Micro Devices Inc. | AMAT | AMD | Applied Materials Inc. | Micron Technology Inc. | MU | Novellus Systems Inc. | NVLS | Semiconductor Equipment & Materials | Technology

RSS Feeds by Tag: Advanced Micro Devices Inc. | AMAT | AMD | Applied Materials Inc. | Micron Technology Inc. | MU | Novellus Systems Inc. | NVLS | Semiconductor Equipment & Materials | Technology |

Other Posts by: vitalstocks | RSS Feed for this author