© Orbotech Electronics Production | March 19, 2018
KLA-Tencor to acquire Orbotech in a $3.4 billion deal
Semiconductor equipment maker, KLA-Tencor Corp, has entered into a definitive agreement with Orbotech under which KLA will acquire the Israeli company in a deal valued at USD 3.4 billion.
KLA-Tencor will acquire Orbotech for USD 38.86 in cash and 0.25 of a share of KLA-Tencor common stock in exchange for each ordinary share of Orbotech, implying a total consideration of approximately USD 69.02 per share, a press release reads. In addition, KLA-Tencor also announced a USD 2 billion share repurchase authorisation, which the company targets to complete within 12 to 18 months following the close of the acqusition. “This acquisition is consistent with our strategy to pursue sustained, profitable growth by expanding into adjacent markets,” commented Rick Wallace, President and Chief Executive Officer of KLA-Tencor. “This combination will open new market opportunities for KLA-Tencor, and expands our portfolio serving the semiconductor industry,” Mr. Wallace continued, “Our companies fit together exceptionally well in terms of people, processes, and technology. In addition, KLA-Tencor has had a strong presence in Israel over the years, and this combination further expands our operations in this important global technology region.” This acquisition is set to diversify KLA-Tecnor’s revenue base and add USD 2.5 billion of addressable market opportunity in the high-growth PCB, flat panel display, packaging, and semiconductor manufacturing areas. “This acquisition is a true testament to Orbotech’s strong leadership and success,” said Asher Levy, Chief Executive Officer of Orbotech Ltd. “I firmly believe that this deal benefits our employees and creates additional value for our shareholders. Together with KLA-Tencor, we will significantly increase growth potential, accelerate our product development roadmap, and enhance customer offerings,” Mr. Levy added. Orbotech will continue to operate under the Orbotech brand as a standalone business of KLA-Tencor based in Yavne, Israel. The transaction has already been approved by the boead of directos of both companies and is expected to close by the fourth quarter of calendar year 2018 – subject to approval by Orbotech’s shareholders.