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A huge exit for Israeli high-tech: Orbotech sells for $ 3.4 billion

March 19, 2018

 

The American company KLA-Tencor will buy the company from Yavneh, which is engaged in testing chip manufacturing processes, at a premium of 17% above the market price. Among Orbotech's most prominent shareholders are Kobi and Yehudit Richter, who hold 5.4% of the company's shares; CEO Asher Levi: "The transaction strengthens the opportunities of the joint company to cope with the investment waves in the world of electronics"

 

The American chip company, KLA-Tencor, is acquiring Orbotech (6.99% 8.07%) in cash and shares. The proceeds will include $ 36.86 in cash and 0.25 KLA-Tencor shares for each Orbotech share.

 

The value of the total consideration is $ 69.02 share, 17% higher than the share price on the market - it closed yesterday at $ 59.02. The consideration reflects Orbotech's market cap of $ 3.4 billion - the company's market value is currently $ 2.9 billion.

 

Among the founders of the company involved in the testing of chip manufacturing processes are the Koby and Yehudit shareholders, who hold 5.4% of Orbotech, and Yochai Richter, who holds 2.1% of the shares (and serves as chairman of the company). , Delek Group (2.5%), Menorah Mivtachim (1.58%), Yellin Lapidot (1.44%), Barclays Israel, led by Len Rosen, as Orbotech's financial advisors.

 

Orbotech has climbed 87% in the past 12 months and 19.5% since the beginning of the year. The start of the climb is a successful acquisition in August 2014 of Britain's SPTS from Bridgepoint for $ 370 million in cash. For a company that had specialized in testing equipment for the lead industry, the decision to switch to production equipment was significant and pushed it forward.

 

The move put Orbotech into the advanced packaging market for chips, spurred its scope of activity, introduced it into new markets, expanded its basket of products and services and got it access to new material customers.

Asher Levy, CEO of Orbotech

 

Orbotech concluded 2017 with an 11.7% increase in revenues to $ 900 million, and profits soared 66% to $ 132 million. At the end of 2017, the company employed 2,634 employees worldwide. 757 of them from Israel, 1,059 from the Far East, including Japan, 307 from the UK, 236 from other European countries, and 275 from the US The number of employees in the company increased by 7.9% compared to the previous year, 58.

 

Orbotech CEO Asher Levy said, "The acquisition is further proof of Orbotech's position in the markets in which it operates and the strength of its business model. waves expected in the coming years in the world of electronics.

 

The connection will improve the future of our employees and will create great value for our shareholders. The combination with KLA will significantly increase Orbotech's growth potential by enabling us to leverage KLA's technological leadership to accelerate our product development plans and improve our solutions offerings to our customers. Orbotech will continue to operate as a single unit under the Orbotech brand, and the company headquarters will continue to operate from Yavneh. "

 

Prime Minister Benjamin Netanyahu said in his Twitter account, "Congratulations to Orbotech, which was sold today to American company KLA-Tencor for $ 3.4 billion, and I was happy to hear that the company, which employs 2,500 people, will continue to operate from Yavneh. The high-tech industry and the Israeli economy! "

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