Globes: KLA-Tencor buying Orbotech for $3.4b
CEO Asher Levy: Orbotech will continue to operate under the Orbotech brand as a standalone business of KLA-Tencor based in Yavne.
KLA-Tencor Corporation (KLAC) is buying Israeli automated optical inspection equipment company Orbotech Ltd. (Nasdaq: ORBK) in a deal worth $3.4 billion. Orbotech’s current market cap is $2.9 billion. The companies announced that KLA-Tencor will acquire Orbotech for $38.86 in cash and 0.25 of a share of KLA-Tencor common stock in exchange for each ordinary share of Orbotech, implying a total consideration of approximately $69.02 per share. The transaction values Orbotech at an equity value of approximately $3.4 billion and an enterprise value of $3.2 billion.
The chief beneficiaries of deal are Kobi and Judith Richter, who own 5.4% of Orbotech. In 1983, Kobi Richter and his brother Yochai were among the founders of Orbot, which merged with another Israeli AOI company Optrotech in 1992 to form Orbotech.
“This acquisition is a true testament to Orbotech’s strong leadership and success,” said Orbotech CEO Asher Levy. “I firmly believe that this deal benefits our employees and creates additional value for our shareholders. Together with KLA-Tencor, we will significantly increase growth potential, accelerate our product development roadmap, and enhance customer offerings. Orbotech will continue to operate under the Orbotech brand as a standalone business of KLA-Tencor based in Yavne, Israel.”
The announcement of the acquisition states, “With this acquisition, KLA-Tencor will significantly diversify its revenue base and add $2.5 billion of addressable market opportunity in the high-growth printed circuit board, flat panel display, packaging, and semiconductor manufacturing areas. The broader portfolio of leading products, services, and solutions, as well as increased exposure to technology megatrends, will support KLA-Tencor’s long-term revenue and earnings growth targets.”