Applied Materials to Acquire Metron Technology for 0.41 Times Revenue

Weekly Corporate Growth Report, Aug 30, 2004

The Deal: Applied Materials Inc. has agreed to acquire Metron Technology NV for approximately $85 million. The deal still requires regulatory and shareholder approvals. The transaction is scheduled to close in Metron's second fiscal quarter, which ends November 30, 2004. As part of the deal, Applied Materials will also assume certain Metron liabilities.

Discussion: Metron Technology supplies production equipment and materials to manufacturers of semiconductors. The company sells third-party equipment for cleaning, fabrication, and inspection, as well as materials including wafer handling components, chemicals, and clean room products. The company also provides services such as installation, materials management, and maintenance.

Applied Materials is the world's largest maker of semiconductor production equipment. Applied Materials develops products for many stages of the chip making process, including deposition, etching, and ion implantation. Customers of the company include Intel, Advanced Micro Devices, Motorola, and Samsung Electronics. The company also develops metrology and inspection equipment.

Applied Materials has stated that acquiring a provider of outsourcing solutions will expand its portfolio and leverage the strength of both companies. "The acquisition of Metron is another significant step in the expansion of service solutions that we offer to customers," said Mike Splinter, president and chief executive of Applied Materials.