TOKYO and SANTA CLARA, Calif., Sept. 24, 2013 /PRNewswire/ -- Applied
Materials, Inc. (NASDAQ: AMAT) and Tokyo Electron Limited
(TSE: 8035) today announced a definitive agreement to create a
global innovator in semiconductor and display manufacturing
technology via an all-stock combination which values the new
combined company at approximately $29
billion (¥2.8 trillion). This combination, which has been
unanimously approved by the Boards of Directors of both companies,
brings together complementary leading technologies and products to
create an expanded set of capabilities in precision materials
engineering and patterning that are strategically important for
customers. The closing of the transaction is subject to customary
conditions, including approval by Applied Materials' and Tokyo
Electron's shareholders and review by regulators. The
companies expect the transaction to close in mid to second half of
2014.
Tetsuro Higashi, Chairman,
President and CEO of Tokyo Electron, said, "Today, we are launching
a new company and taking a bold step forward for our
industry. Built on a foundation of people, technology and
commitment, we are creating a truly global company that we believe
will expand the value we deliver to our customers and be able to
achieve new levels of financial performance."
Gary Dickerson, President and CEO
of Applied Materials, said, "We are creating a global innovator in
precision materials engineering and patterning that provides our
new company with significant opportunities to solve our customers'
high-value problems better, faster and at lower cost. We
believe the combination will accelerate our momentum for profitable
growth, increase the value we deliver to shareholders and create
great opportunities for our employees."
The combined organization is intended to accelerate the existing
strategic visions of Applied Materials and Tokyo Electron and
increase the new company's opportunity to enable major, future
technology inflections and advance customers' roadmaps in both
semiconductor and display. Extraordinary advances in
semiconductor and display technology have made it possible to mass
produce affordable personal electronics, putting PCs, smartphones,
tablets and other amazing devices in the hands of consumers around
the world.
Today, the mobility trend is driving a new phase of industry
growth and introducing dramatic and fundamental technology changes
in the way devices are made. Materials innovation is the most
significant lever for customers to drive cost-effective performance
gains in mobile chips and displays. With the best and broadest
capability in materials engineering, Applied Materials and Tokyo
Electron believe this new company will be well-positioned to
provide valuable, differentiated device performance and yield
solutions that enable the new device architectures and
cost-effective scaling that customers need to win.
Said Higashi and Dickerson jointly, "We are building this new
company in the spirit of a merger of equals. For five
decades, we have each made significant contributions to the
semiconductor industry and we have deep respect for the
capabilities that the other brings to this combination. Both
companies have a strong heritage of customer service and an
enduring commitment to push the boundaries of technology and
engineering. We share many common values and are confident we
will execute together to achieve our strategic and financial
goals."
As a clear signal of the commitment to create a new global
enterprise, the company will have a new name, dual headquarters in
Tokyo and Santa Clara, a dual listing on the Tokyo Stock
Exchange and the NASDAQ, and will be incorporated in The Netherlands.
The new company will have a shared leadership team. Tetsuro Higashi will serve as Chairman, and
Gary Dickerson will serve as Chief
Executive Officer. The board will be made up of eleven
directors with five directors appointed by each company and one
additional director to be mutually agreed upon. Seven of the eleven
directors will be independent. Bob
Halliday of Applied Materials will serve as Chief Financial
Officer.
Under the terms of the agreement, Tokyo Electron shareholders
will receive 3.25 shares of the new company for every Tokyo
Electron share held. Applied Materials shareholders will receive 1
share of the new company for every Applied Materials share held.
After the close, Applied Materials shareholders will own
approximately 68% of the new company and Tokyo Electron
shareholders approximately 32%.
The companies expect to achieve $250
million in annualized run-rate operating synergies by the
end of the first full fiscal year and $500
million in run-rate operating synergies realized in the
third full fiscal year. In addition, the new company expects
to realize meaningful savings as a result of the new corporate
structure. The new company intends to commence a $3.0 billion stock repurchase program targeted to
be executed within 12 months following the close of the
transaction. On a non-GAAP basis, taking into account the buyback,
the transaction is expected to be EPS accretive at the end of the
first full fiscal year after transaction close.
Goldman, Sachs & Co. acted as Applied Materials' exclusive
financial advisor, and Weil, Gotshal & Manges LLP, Mori, Hamada
& Matsumoto, and De Brauw Blackstone Westbroek acted as legal
counsel to Applied Materials. Mitsubishi UFJ Morgan Stanley
Securities Co., Ltd. acted as Tokyo Electron's exclusive financial
advisor, and Jones Day, and
Nishimura & Asahi acted as legal counsel to Tokyo
Electron.
More information on the announcement can be found at
www.newglobalinnovator.com.
Press Conference Information
Applied Materials and
Tokyo Electron will hold a live press conference today at
7:00 p.m. JST at the Tokyo Electron,
Akasaka Biz Tower, 3-1 Akasaka 5-chome, Minato-ku, Tokyo 107-6325.
Conference Call and Webcast Information
Applied
Materials and Tokyo Electron will also hold a conference call that
begins at 8:00 a.m. EDT/5:00 a.m. PDT today. A live webcast will be
available on the Investor Relations page of
www.appliedmaterials.com. Dial-in details are also available:
1-877-356-9175 (United States) or
1-706-679-5064 (outside the United
States); Conference ID: 70356685.
About Applied Materials
Applied Materials, Inc.
(NASDAQ:AMAT) is the global leader in providing innovative
equipment, services and software to enable the manufacture of
advanced semiconductor, flat panel display and solar photovoltaic
products. Our technologies help make innovations like smartphones,
flat screen TVs and solar panels more affordable and accessible to
consumers and businesses around the world. Learn more
at www.appliedmaterials.com.
About Tokyo Electron
Tokyo Electron Limited (TEL),
established in 1963, is a leading supplier of innovative
semiconductor, flat panel display and photovoltaic panel production
equipment worldwide. All of TEL's semiconductor and flat panel
display production equipment product lines maintain high market
shares in their respective global segments. TEL has located
research & development, manufacturing, sales, and service
locations all over the world. http://www.tel.com
Contact Information
Editorial/Media Contacts
Kevin Winston, Applied Materials
Corporate Communications
(408) 235-4498
Kevin_winston@amat.com
Joseph Lo, Brunswick Group
+852 (9850) 5033
Jlo@brunswickgroup.com
Investor Relations Contact
Michael Sullivan, Applied Materials
Investor Relations
(408) 748-5635
Michael_sullivan@amat.com
Editorial/Media Contacts
Tokyo Electron Limited
Public Relations Group
telpr@tel.com
John Sunley / Dan Underwood / Richard
Brown, Ashton
Consulting
+81 3 5425-7220
jas@ashton.jp
Investor Relations Contact
Tokyo Electron Limited
Investor Relations Dept.
telir@tel.com
Forward-Looking Statements
This communication contains forward-looking statements,
including but not limited to those regarding the proposed business
combination between Applied Materials, Inc. ("Applied Materials"),
and Tokyo Electron Limited ("Tokyo Electron") (the "Business
Combination") and the transactions related thereto. These
statements may discuss the anticipated manner, terms and conditions
upon which the Business Combination will be consummated, the
persons to be appointed officers and directors of a to-be-formed
holding company ("HoldCo"), trends and the future performance of
their businesses, the synergies of Applied Materials and Tokyo
Electron, and similar things. Forward-looking statements may
contain words such as "expect," "believe," "may," "can," "should,"
"will," "forecast," "anticipate" or similar expressions, and
include the assumptions that underlie such statements. These
statements are subject to known and unknown risks and uncertainties
that could cause actual results to differ materially from those
expressed or implied by such statements, including but not limited
to: the ability of the parties to consummate the Business
Combination in a timely manner or at all; satisfaction of the
conditions precedent to consummation of the Business Combination,
including the ability to secure regulatory approvals in a timely
manner or at all, and approval by Applied Materials' and Tokyo
Electron's stockholders; the possibility of litigation (including
related to the transaction itself); Applied Materials' and Tokyo
Electron's ability to successfully integrate their operations,
product lines, technology and employees and realize synergies,
growth and tax assets from the Business Combination; unknown,
underestimated or undisclosed commitments or liabilities; the
potential impact of the announcement or consummation of the
proposed transactions on the parties' relationships with third
parties; the level of demand for the combined companies' products,
which is subject to many factors, including uncertain global
economic and industry conditions, demand for electronic products
and semiconductors, and customers' new technology and capacity
requirements; Applied Materials' and Tokyo Electron's ability to
(i) develop, deliver and support a broad range of products,
expand their markets and develop new markets, (ii) timely
align their cost structures with business conditions, and
(iii) attract, motivate and retain key employees; and other
risks described in the Applied Materials' filings with the
Securities & Exchange Commission (the "SEC"). Tokyo Electron's
filings with the Financial Services Agency of Japan and the S-4 registration statement to be
filed by HoldCo. All forward-looking statements are based on
management's estimates, projections and assumptions as of the date
hereof. Except as required under applicable law, none of
Applied Materials, Tokyo Electron or HoldCo undertakes any
obligation to update any forward-looking statements.
No Offer or Solicitation
This announcement is for informational purposes only and is
neither an offer to purchase, nor a solicitation of an offer to
sell, subscribe for or buy any securities or the solicitation of
any vote in any jurisdiction pursuant to the proposed transactions
or otherwise, nor shall there be any sale, issuance or transfer of
securities in any jurisdiction in contravention of applicable
law. No offer of securities shall be made except by means of
a prospectus meeting the requirements of Section 10 of the
Securities Act of 1933, as amended, and applicable regulations in
the Netherlands and Japan.
Additional Information and Where to Find It
Applied Materials and Tokyo Electron intend to cause HoldCo to
file with the SEC a registration statement on Form S-4 (the
"Registration Statement"), which will include a prospectus with
respect to HoldCo's ordinary shares to be issued in the Business
Combination and a proxy statement of Applied Materials in
connection with the Business Combination between Applied Materials
and Tokyo Electron. The definitive Registration Statement
will contain important information about the proposed Business
Combination and related matters. SECURITY HOLDERS ARE URGED
AND ADVISED TO READ THE REGISTRATION STATEMENT CAREFULLY WHEN IT
BECOMES AVAILABLE. The Registration Statement and other
relevant materials (when they become available) and any other
documents filed by Applied Materials, HoldCo or Tokyo Electron with
the SEC may be obtained free of charge at the SEC's web site at
www.sec.gov. In addition, security holders will be able to
obtain free copies of the Registration Statement from Applied
Materials or Tokyo Electron by contacting either (1) Investor
Relations by mail at Applied Materials, 3050 Bowers Avenue M/S
1261, P.O. Box 58039, Santa Clara,
CA 95054-3299, Attn: Investor Relations Department, by
telephone at 408-748-5227, or by going to Applied Materials'
Investor Relations page on its corporate web site at
www.appliedmaterials.com or (2) Tokyo Electron's Public Relations
Group, by mail at Tokyo Electron, Akasaka Biz Tower, 3-1 Akasaka
5-chome, Minato-ku, Tokyo
107-6325, by telephone at 512-424-1757, or by email at
telpr@tel.com, or by going to Tokyo Electron's Investor Relations
page on its corporate web site at www.tel.com.
Participants in the Solicitation
Applied Materials, Tokyo Electron, HoldCo and their respective
directors and executive officers may be deemed to be participants
in the solicitation of proxies from Applied Materials' stockholders
in connection with the proposed Business Combination.
Information about Applied Materials' directors and executive
officers is set forth in Applied Materials' Proxy Statement on
Schedule 14A for its 2013 Annual Meeting of Stockholders, which was
filed with the SEC on January 22, 2013, and its Annual Report
on Form 10-K for the fiscal year ended October 28, 2012, which
was filed with the SEC on December 5, 2012. These
documents are available free of charge at the SEC's web site at
www.sec.gov, and from Applied Materials by contacting Investor
Relations by mail at Applied Materials, 3050 Bowers Avenue M/S
1261, P.O. Box 58039, Santa Clara,
CA 95054-3299, Attn: Investor Relations Department, or by
going to Applied Materials' Investor Relations page on its
corporate web site at www.appliedmaterials.com. Additional
information regarding the interests of participants in the
solicitation of proxies in connection with the proposed Business
Combination will be included in the Registration Statement that
Applied Materials and Tokyo Electron intend to cause HoldCo to file
with the SEC.
SOURCE Applied Materials, Inc.