TOKYO (AP) — Chip-making equipment manufacturer Applied Materials is acquiring Tokyo Electron Ltd., a rival maker of equipment for production of semiconductors, flat panel displays and solar panels.
The two companies said Tuesday their all-stock transaction will result in the creation of a new company with market capitalization of $29 billion.
Tokyo Electron's chairman Tetsuro Higashi said the deal is meant to create a "truly global company" to meet the needs of companies supplying consumer electronics such as smartphones and tablets.
The new company will have shared leadership, with Higashi as its chairman and Applied Materials' president and CEO Gary Dickerson as its CEO.
Tokyo Electron's profit has stagnated in the past few years because of weaker demand from chip makers.