Cabot Microelectronics Corporation Completes Acquisition of KMG Chemicals
November 15 2018 - 9:15AM
Cabot Microelectronics Corporation (Nasdaq: CCMP), today announced
that it has completed its previously announced acquisition of KMG
Chemicals, Inc. As a result of the acquisition, KMG has
become a wholly owned subsidiary of Cabot Microelectronics.
Under the terms of the definitive agreement, each share of KMG
common stock was converted into the right to receive $55.65 in cash
and 0.2000 of a share of Cabot Microelectronics common stock,
without interest and with cash paid in lieu of any fractional
shares.
The acquisition will extend and strengthen Cabot
Microelectronics’ position as one of the leading suppliers of
consumable materials to the semiconductor industry.
Additionally, the combined company will be a leading global
provider of performance products and services for improving
pipeline operations and optimizing throughput. The
transaction is expected to be significantly accretive to Cabot
Microelectronics’ free cash flow and adjusted earnings per share in
year one, excluding any acquisition-related costs.
"I am pleased to announce that we have completed
the KMG transaction. We welcome KMG's employees to our team
and look forward to our journey together towards becoming the
premier global provider of semiconductor and specialty
materials. We believe that our employees, customers and
shareholders will benefit from this transaction as we become a
stronger company, focused on providing high-performing and
innovative solutions to our customers," said David Li,
President and CEO of Cabot Microelectronics. “KMG's
industry-leading electronic materials business will expand our CMP
product offerings with high-purity solutions used throughout the
semiconductor manufacturing process. We are also excited
about the addition of KMG’s performance materials businesses to our
portfolio which will allow us to expand our participation into new
markets including the attractive, high-growth pipeline performance
segment."
In connection with the acquisition, Cabot
Microelectronics borrowed $1.065 billion under a new senior secured
term loan facility, the proceeds of which were used to finance in
part the cash portion of the merger consideration, to repay KMG’s
existing indebtedness and to pay fees and expenses related to the
acquisition. Cabot Microelectronics issued approximately 3.2
million shares of common stock to holders of KMG common stock for
the stock portion of the merger consideration.
ABOUT CABOT MICROELECTRONICS
CORPORATIONCabot Microelectronics Corporation,
headquartered in Aurora, Illinois, is the world's leading supplier
of consumable materials to semiconductor manufacturers and pipeline
operators. The company’s products play a critical role in the
production of advanced semiconductor devices, helping to enable the
manufacture of smaller, faster and more complex devices by its
customers. Cabot Microelectronics Corporation is also a
leading supplier of performance materials to pipeline operators and
industrial wood preservation industry. The company's mission
is to create value by delivering high-performing and innovative
solutions that solve its customers’ challenges. The company
has approximately 1,900 employees globally. For more
information about Cabot Microelectronics Corporation,
visit www.cabotcmp.com or contact Colleen Mumford, Director of
Investor Relations, at 630-499-2600.
FORWARD LOOKING STATEMENTSThis
press release contains forward-looking statements, which address a
variety of subjects including, for example, the expected benefits
of the acquisition of KMG by Cabot Microelectronics.
Statements that are not historical facts, including statements
about Cabot Microelectronics’ beliefs, plans and expectations, are
forward-looking statements. Such statements are based on
current expectations of Cabot Microelectronics’ management and are
subject to a number of factors and uncertainties, which could cause
actual results to differ materially from those described in the
forward-looking statements. The following important factors
and uncertainties, among others, could cause actual results to
differ materially from those described in these forward-looking
statements: higher than expected or unexpected costs associated
with or relating to the acquisition; the risk that expected
benefits, synergies and growth prospects of the acquisition may not
be achieved in a timely manner or at all; the ability to
successfully integrate KMG’s business with Cabot Microelectronics;
the risk that Cabot Microelectronics will be unable to retain and
hire key personnel; and the risk that disruption from the
acquisition may adversely affect Cabot Microelectronics’ business
and its relationships with customers, suppliers, distributors or
employees. For additional information about factors that
could cause actual results to differ materially from those
described in the forward-looking statements, please refer to both
Cabot Microelectronics’ and KMG’s filings with the Securities and
Exchange Commission (“SEC”), including the risk factors contained
in each of Cabot Microelectronics’ and KMG’s most recent Annual
Reports on Form 10-K and the registration statement on Form S-4
filed by Cabot Microelectronics with respect to the shares of Cabot
Microelectronics issued in connection with the acquisition.
Forward-looking statements represent management’s current
expectations and are inherently uncertain. Except as required
by law, Cabot Microelectronics undertakes no obligation to update
forward-looking statements made by it to reflect new information,
subsequent events or circumstances.
Contact:
Colleen Mumford
Director of Investor Relations
Cabot Microelectronics Corporation
(630) 499-2600
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