Applied Materials to buy Japan's Kokusai Electric for $2.2bn

Chip-making equipment supplier Applied Materials has agreed to buy Japan's Kokusai Electric from investment firm KKR for $2.2bn in cash.

Kokusai provides high-productivity batch processing systems and services for memory, foundry and logic customers. Applied Materials said these systems complement its leadership portfolio in single-wafer processing systems.

"Kokusai Electric has strong customer relationships, world-class supply chain and manufacturing capabilities in Japan and Asia, and a talented team of employees," it said.

The deal, which is expected to close in the next 12 months, will see Kokusai operate as a business unit of Applied’s semiconductor products group and continue to be based in Tokyo, with technology and manufacturing centres in Toyama, Japan and Cheonan, Korea.

The acquisition is expected to be immediately accretive to Applied’s non-GAAP earnings per share at close.

Applied's chief executive officer and president, Gary Dickerson, said: "Kokusai Electric has a strong culture of innovation along with excellent customer relationships and serves fast-growing areas of the wafer fab equipment market.

"By bringing Kokusai Electric’s talented team into Applied, we believe we will accelerate innovation for customers and create significant value for our shareholders."

Kokusai's CEO and president, Fumiyuki Kanai, said: "The opportunity to combine with Applied Materials will be very attractive for Kokusai Electric’s customers and employees alike.

"We are excited about the opportunity to integrate Kokusai Electric’s experienced team with Applied’s global development, customer support and services capabilities. We believe the combination will accelerate our ability to bring exciting new technologies to customers."