Wednesday, Ceradyne, Inc. (CRDN), a manufacturer of advanced technical ceramic products, announced that it has signed a definitive agreement and plan of merger to acquire privately-held SemEquip, Inc. for about $25 million in cash at closing and contingent payments of up to $100 million during the 15-year period following completion of the merger, based upon revenues achieved by SemEquip over that period.
The acquisition will expand Ceradyne's Boron products' business and will significantly extend market opportunity in the semiconductor industry, the company said.
A portion of the closing date consideration and the contingent consideration to be paid by Ceradyne relates to a pre-closing commitment by SemEquip to pay incentive compensation to several of its employees and advisors. This incentive compensation will not increase the total consideration but will require Ceradyne to record a pre-tax accounting charge estimated to be in the range of $9 million to $11 million in the quarter during which the acquisition is completed, the company noted.
North Billerica, Massachusetts-based SemEquip develops cluster ion implantation sub-systems and advanced ion source materials for the manufacture of logic and memory chips, and owns a significant patent portfolio related to the use of cluster chemicals in semiconductor ion implantation.
The closing of the deal is expected in about 30 days after approval by SemEquip shareholders.
Ceradyne shares closed Tuesday's trading session on NASDAQ at $33.65, up $1.46, or 4.54%.
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