Dutch semiconductor equipment maker ASM International has bought LPE in Italy, a major manufacturer of epitaxial reactors for silicon carbide (SiC) and silicon, in a deal worth €425m.
Founded in 1972, LPE has exclusively focused on designing, manufacturing and selling advanced epitaxy tools for power applications and has published several key patents on the technology.
ASM is paying €283.25 million in cash from its reserves and 631,154 ASM shares for a total enterprise value of €425m An additional amount of up to €100 million will be paid by way of an earn out based on certain performance metrics over a two-year period after the closing of the transaction.
LPE, based in Milan, has its only other European office in Catania, where ST Microelectronics has its key SiC fab and is building a new plant to produce SiC wafers and devices from silicon powder using its inhouse technologies acquired with Norstel.
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- ST takes over SiC wafer maker Norstel
ASM’s internal estimates see demand for SiC epitaxy equipment growing at over 25% a year from 2021 to 2025. Revenue expectations for LPE in 2023 are greater than €100 million, mainly driven by its SiC epitaxy equipment business.
“LPE with its strong culture of innovation and traction with silicon carbide device makers, both for 150mm and 200mm substrates, is well positioned to serve the needs of global automotive customers and their decarbonization drive,” said Benjamin Loh, President and CEO of ASM.
“Next to ASM’s expanding position in advanced Epi applications for the logic/foundry and memory markets, ASM is also a leader in silicon epitaxy solutions for the power electronics, analog and wafer markets,” he said.
“LPE’s offering of advanced SiC epitaxy tools complements ASM’s offering. I’m confident that the combination of LPE and ASM will help our customers accelerate their roadmaps towards next-generation more efficient power electronics, which will enable the further electrification of the automotive industry. The acquisition of LPE adds another high-growth business to our portfolio of differentiated deposition technologies and presents meaningful opportunities to create value by leveraging our innovative epitaxy technologies to further differentiate the product offering of LPE, by building upon our significant customer base in the power electronics market segment, and by utilizing our global field service network to address customer needs,” he added.
“We believe the acquisition by ASM will be attractive for LPE’s and ASM’s customers as well as for employees,” said Franco Preti, CEO of LPE. “The acquisition will additionally enable LPE to gain access to world-class R&D resources, as well as leverage on ASM’s global operations, sales and customer support network.”
The transaction is subject to regulatory approvals in a limited number of countries and the two expect the deal to close by November 10, 2022. If this doesn’t happen, they plan to discuss extend acquisition period by six months. The plan is for LPE to operate as a product unit under ASM’s Global Products organization and it will continue to be based in Italy, with technology and manufacturing centres in Milan and Catania.
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