ASML acquires Cymer to accelerate next-gen manufacturing technology

Contact: Thejeswi Venkatesh

Dutch company ASML Holding, which supplies lithography systems to chip manufacturers like Intel and Texas Instruments, has announced the acquisition of its own supplier Cymer for $2.5bn. ASML integrates Cymer’s light sources into its lithography tools, which it then sells to chipmakers.

ASML says the acquisition accelerates the development of next-generation manufacturing technology, which is needed to create energy-efficient microchips with more functions at a lower cost. The deal comes just three months after Intel invested $4.1bn in ASML to speed the development of advanced manufacturing tools.

Cymer shareholders will receive $20 in cash and 1.1502 ASML shares, valuing each Cymer share at $81.60, which is their highest-ever price. It’s also an eye-popping 70% premium over the company’s Tuesday close, and values it at 4.3 times trailing sales. On the announcement and a relatively weak financial outlook, ASML stock dipped 8% on heavy trading.

The deal is only ASML’s second and largest ever, according to The 451 M&A KnowledgeBase. In December 2006, ASML bought EDA tools vendor Brion Technologies for $270m.