World Economy

Lam Research Bids $10b to Create Chip Giant

Lam Research Bids $10b to Create Chip GiantLam Research Bids $10b to Create Chip Giant

Lam Research is buying KLA-Tencor Corp. for about $10.6 billion, creating a huge player in the semiconductor sector that will rival Applied Materials Inc, according to Associated Press. The combined company, to be called Lam Research Corp., will have a market capitalization of around $19 billion, about equal to that of Applied Materials, and says it will serve 42% of the wafer fabrication equipment market when the deal closes in the middle of next year. The offer, for $67.02 per share, marks a 24% premium to the closing price for KLA-Tencor Corp. on Tuesday. Lam says it will book $250 million in annualized savings within two years. Shares of Lam Research rose 2% before the opening bell Wednesday. Both companies are based in California.