A deal has been struck – II-VI to acquire Coherent

Under the terms of the transaction, Coherent shareholders will receive USD 220.00 in cash and 0.91 of a share of II-VI common stock for each Coherent share. “We are pleased to have reached an agreement with Coherent to create a global leader in photonic solutions, compound semiconductors and laser technology and systems. Together, we will have significant opportunities to accelerate our growth through complementary technology platforms, strengthen our competitiveness by using our combined scale across the value chain, benefit from deeper market intelligence and expertise, and further diversify our businesses by end market and geography,” says Dr. Vincent D. Mattera, Jr., Chief Executive Officer of II-VI, in a press release. “Moreover, the combination of II-VI and Coherent will increase our collective exposure to irreversible megatrends for decades to come. We are excited to welcome the talented Coherent team to II-VI and look forward to working together to deliver significant value to all stakeholders, including both companies’ shareholders, customers, employees, and business partners,” the CEO continues. Together, II-VI and Coherent will create a global powerhouse in photonic solutions, compound semiconductors, and laser technology and systems with approximately USD 4.1 billion in annual revenue. II-VI states in the press release that the companies complementary lasers, optics, and electronics technologies at the subsystems and systems level will enable solutions to accelerate growth in aerospace and defense, life sciences, and laser-additive manufacturing, while driving margin expansion and profitability. In addition, the complementary geographic presence will enable the company to accelerate growth in key industrial markets in Asia. The combined company is expected to achieve USD 250 million in annual cost synergies to be realised within 36 months of close. II-VI plans to finance the transaction with cash on hand, approximately USD 5.4 billion in fully committed debt financing from J.P. Morgan Securities LLC and an equity investment from Bain Capital. Bain Capital has committed USD 1.5 billion in the combined company at a conversion price of USD 85.00 per share. The transaction, which is expected to close by year-end 2021 and has been approved by the board of both companies.