Many hurdles face Tokyo Electron-Applied Materials merger

October 3
9:32 PM 2013

Many market analysts had cast their bets on Applied Materials Inc completing its acquisition of Tokyo Electron Ltd despite the shadow of a lengthy antitrust review. The USD9.39 billion deal would just be the start of great things for the firm as it acquires the world's top supplier of chipmaking equipment.

Last week, Applied Materials finalized an all-stock purchase of Tokyo Electron Ltd. The combined capacity of the first and third largest chip equipment manufacturers in the world would corner 25% of the total market share. According to data obtained by Bloomberg, share values of Tokyo Electron fell due to investor concerns on regulatory approvals and the length of the time needed for the completion of the deal. Despite this, more deals are expected to be added on and overall, both shares of stock have individually jumped 6% since the deal was anounced.

It is expected that the transaction would be completed by the latter part of 2014 after regulatory clearance has been obtained from China, Japan and the United States. 

In a statement from Tokyo Eletron spokesperson Tatsuya Aso, "At this point, we plan to close the consolidation in the latter half of 2014 after the approvals by authorities and shareholders."

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