Twitter LinkedIn
    Friday, May 20
    Login
    0 Shopping Cart
    Twitter LinkedIn
    Private Equity InsiderPrivate Equity Insider
    • About Us
    • Digital Events
    • Our Network
      • Reach
      • Sponsors
      • Members
    Private Equity InsiderPrivate Equity Insider
    Home»Uncategorized»KKR is seeking $3.5B for Kokusai
    Uncategorized

    KKR is seeking $3.5B for Kokusai

    January 8, 20213 Mins Read
    LinkedIn Facebook Twitter Email WhatsApp
    Share
    LinkedIn Facebook Twitter Email WhatsApp

    Applied Materials Inc. one of the largest makers of machines used to manufacture semiconductors, said it raised its offer for KKR & Co.-owned Kokusai Electric Corp. by 59%, citing higher valuations in a growing industry. It also extended the closing deadline by almost three months.

    The U.S. company will pay KKR $3.5 billion, up from the originally agreed $2.2 billion, for Kokusai, Applied said in a filing. The two parties have agreed to a new closing date of Mar. 19 to allow for regulatory approval from China, the final remaining jurisdiction where sign-off is needed.

    Applied said the large increase reflects improving demand for chipmaking gear and the earnings prospects for the combined entity, part of a growing trend that’s pushed up the valuations of industry companies. It’s making progress toward getting the green light from China‘s State Administration for Market Regulation. Shares of Applied Materials climed 3.2% to $89.03 at 9:50 a.m. in New York.

    The U.S. firm “believes that the acquisition will provide substantial value for Applied’s shareholders,” according to the filing. “Over the past 18 months, Applied has observed a more favorable long-term outlook for the overall semiconductor equipment market, including positive trends in the memory segment.”

    Chip-related share prices have surged on optimism that the electronic components are becoming more important, not only in traditional markets such as computers and smartphones, but also in new areas such as self-driving cars. The Philadelphia Stock Exchange Semiconductor Index surged 51% in 2020, adding to a gain of 60% in 2019. Shares of Applied Materials rose 41% last year.

    Applied’s ability to get approval from China will be watched closely by investors. Semiconductors have become a key area of contention in the trade war between China and the U.S. under the administration of President Donald Trump. The U.S. is the world’s biggest producer of chips and the Asian country is the biggest market.

    California-based Applied Materials dominates the market for equipment involved in the early stages of turning silicon wafers into computer chips. Its main customers are Samsung Electronics Co., Intel Corp. and Taiwan Semiconductor Manufacturing Co. Applied Materials went on a sales-growth spurt under Chief Executive Officer Gary Dickerson as chipmakers ordered more machinery to help solve the increasing complexity of semiconductors.

    Investment firm KKR bought the Japanese equipment manufacturer, a former Hitachi Ltd. unit, in 2017. Before the deal closed, KKR made a bid that valued Kokusai Electric at $3 billion, although it’s not clear how much KKR ultimately paid.

    Related

    Can't stop reading? This and all news articles are property of their creators, many are not owned or provided by Private Equity Insider. As an event organizer and community platform, we curate content from reliable sources for your suggested reading, and advise you to read the full articles from the referenced authors and sources.

    uncategorized
    Share. LinkedIn Facebook Twitter Email WhatsApp

    Related Posts

    Sequoia Capital just blew up the VC fund model

    October 28, 2021

    Private equity firm Silver Lake leads $1 billion investment in Thrasio

    October 26, 2021

    European life sciences investor Sofinnova Partners raises $548m

    October 25, 2021

    Private Equity rivals join forces with € 3.7 billion bid for pet care group Zooplus

    October 25, 2021

    Comments are closed.

    Other Articles

    NatWest to cut UK government stake with $1.5 billion buyback

    March 19, 2021

    Cryptocurrency prediction platform TotemFi raises USD255,000 in strategic funding round

    March 16, 2021

    LVMH-Backed Private Equity to Buy Majority Stake in Italy’s Etro

    July 18, 2021

    ICV Partners appoints Managing Director of Portfolio Operations Group

    January 31, 2021

    Private Equity Insider LLC
    1212 Avenue of the Americas
    New York City 10036
    USA

    [email protected]

    Twitter LinkedIn
    © 2022 Private Equity Insider LLC. All rights reserved.
    • About
    • Terms of Use
    • Cookie Policy
    • Privacy Policy
    • Contact Us

    Type above and press Enter to search. Press Esc to cancel.

    View Cart Checkout Continue Shopping

    Sign In or Register

    Welcome Back!

    Login to your account below.

    Lost password?