Why Applied Materials Is Buying Tokyo Electron

REPLAY VIDEO
Your next video will start in
Pause

Recommended Videos

  • Info

  • Comments

  • VIDEO TEXT

Sept. 24 (Bloomberg) -- Applied Materials Chairman Mike Splinter discusses the company's $9.4 billion acquisition of Tokyo Electron on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

Materials headquarters.

Foreign takeovers and japan are very rare.

How did this deal come together?

This is a merger of equals.

We are bringing the companies together with shared management and a shared governance.

I think that that was at the heart of being able to accomplish this combination.

Without that, i don't think we would have been able to do it.

We have known the principles at tokyo electron for many many years.

We have had great relationships and it has blossomed into denouncing we made today.

You you call yourself equals but for years you have been fierce competitors.

The ceo of applied materials will be the one running this joint company.

How do you overcome the cultural challenges that any two companies would face coming together, let alone to competitors?

Is very interesting.

When you look at our product lines, they are very complementary.

This is one of the reasons why we think that this combination is really works.

It works for regulators, it works for the two companies coming together.

I am tremendously excited about when we can get our engineers and technologists together and start to think about the customer problems that we can solve with all of these new complementary technologies.

Together, these two companies have over 26 thousand patents.

Is really tremendous.

There are very few companies out there that are buying chipmaking equipment.

The list is short.

How does this impact your strategy?

Some people have said that this is a defensive rather than an offense of move.

I think that our customer base has consolidated quite a bit over the last 10 years.

For us, this combination really makes both of our strategies more doable, more publishable -- more able to be accomplished.

We think that bringing the two companies together, we will gain market share the cuts we have these complementary capabilities that will be available to be brought together to solve even more of the customer's problems.

-- we will gain market share because we have complementary capabilities.

We will solve these quicker and at lower costs and deliver them.

Chipmakers are needing to adapt to a slowdown in the pc market.

The people who make equipment, that make chips, you will have to adapt as well.

What are the biggest challenges that you will face in the next couple of years?

There are just a just tremendous changes going on.

The fact is that computing continues to go up at the same exponential rate that it has been going for the last 30 years.

It is just the form factors are shifting from desktops to mobile, to smart phones and tablets.

The new challenges are can you make these chips with lower power and still have their he high performance in order to do that, the materials that are used inside of the chips become more important.

The switches, how they get wired together, his materials are incredibly fine and the capabilities that companies both apply to companies and tokyo electron bring to this solution, these are very in our sweet spot of technology.

Any concerns about regulators and potential antitrust issues that might arise from this?

This is a complex deal.

This is a cross-border deal.

This is a stock for stock deal.

When you get inside and you look at our product lines, it is very complementary.

Product by product by product them almost all come from entry.

A -- product by product by product, very complementary.

They will find that this is acceptable and the combination going forward.

Applied materials executive

This text has been automatically generated. It may not be 100% accurate.

Advertisement

BTV Channel Finder

Channel_finder_loader

ZIP is required for U.S. locations

Bloomberg Television in   change