Lam Research (NASDAQ:LRCX) said late yesterday it has agreed to acquire Novellus Systems (NVLS) in an all-stock transaction valued at $3.3 billion.
The deal values Novellus at $44.42 per share, and upon closing Lam shareholders will own 59% of the company, and Novellus shareholders will own 41%.
Lam said the combination of the two semiconductor equipment companies will create $100 million in total cost synergies on an annualized basis by the fourth quarter of 2013.
The acquisition is expected to be accretive to Lam's non-GAAP earnings within a year after the transaction closes, expected in the second calendar quarter of 2012. The transaction has been approved by the boards of both companies.
Lam also announced a $1.6 billion common stock repurchase program, replacing its existing program and targeted for the first 12 months following the close of the Novellus acquisition.
The companies compete with other chip equipment companies like Applied Materials (NASDAQ:AMAT) and ASM International (NASDAQ:ASMI).
Novellus shares are surging on the news, while Lam Research shares are ticking lower.
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