Applied Materials will acquire Kokusai Electric Corp. for $2.2 billion in cash from investment company KKR.
Applied hopes to gain Kokusai’s leadership position in batch processing systems and its customer services for memory, foundry and logic. Such capabilities will complement Applied’s single-wafer processing systems.
“Kokusai Electric has a strong culture of innovation with excellent customer relationships and serves fast-growing areas of the wafer fab equipment market,” Applied CEO Gary Dickerson said in a statement released Monday.
Applied’s board has approved the transaction, which is expected to close within a year following regulatory approvals. Applied is using cash on hand and a term loan to make the purchase.
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The U.S. does not require regulatory approval of the deal, but Japan, China and Korea do.
After the deal closes, Kokusai will be run as a business unit within the semiconductor products group of Applied. It will continue to be based in Tokyo with manufacturing in Japan and Korea.
Kokusai CEO Fumiyuki Kanai said the deal “will be very attractive” for Kokusai’s customers and employees and “will accelerate our ability to bring exciting new technologies to customers.”
Kokusai uses vertical diffusion furnaces used by some DRAM and NAND makers. Applied expects to boost its revenues by 10% with the purchase. In 2018, Kokusai had about $1.8 billion in revenues, roughly one-tenth of Applied’s revenues of $17.25 billion.