(MENAFN- Khaleej Times) The US Applied Materials and the Japanese rival chipmaker Tokyo Electron said they will merge in an all-stock deal, creating a $29 billion company.
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, according to the (CNBC.com) website.
The companies make equipment for production of semiconductors, flat panel displays and solar panels.
After the deal is closed, Applied Materials shareholders will own approximately 68% of the new company and Tokyo Electron shareholders approximately 32%.
The combined company would maintain dual listing on the Nasdaq and Tokyo Stock Exchange, the companies said in a joint statement.
Tokyo Electron's chairman Tetsuro Higashi said the deal is meant to create a "truly global company" to meet the needs of companies supplying consumer electronics such as smartphones and tablets.
The new company will have shared leadership, with Higashi as its chairman and Applied Materials' president and CEO Gary Dickerson as its CEO.
Tokyo Electron's profit has stagnated in the past few years because of weaker demand from chipmakers.
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