Entegris, Inc. (ENTG) and CMC Materials, Inc. (CCMP) announced Wednesday a definitive merger agreement under which Entegris will acquire CMC Materials in a cash and stock transaction with an enterprise value of approximately $6.5 billion.
Under the terms of the agreement, CMC Materials shareholders will receive $133.00 in cash and 0.4506 shares of Entegris common stock for each share of CMC Materials common stock they own. The total per share consideration represents a 35% premium over CMC Materials’ closing price on December 14, 2021.
Upon completion of the transaction, Entegris shareholders will own approximately 91% of the combined company and CMC Materials shareholders will own approximately 9%.
CMC Materials is a leading supplier of advanced materials primarily for the semiconductor industry. The addition of CMC Materials’ leading CMP portfolio will broaden Entegris’ solutions set, creating a comprehensive electronic materials offering.
The transaction is expected to be significantly accretive to adjusted earnings per share within the first year post-closing. Entegris expects to realize $75 million in run-rate cost synergies and $40 million in CapEx synergies within 12 to 18 months from the closing of the transaction.
The transaction is to be financed with a combination of equity issued to CMC Materials, new debt and cash on hand. Entegris has obtained fully committed debt financing from Morgan Stanley Senior Funding, Inc. however, the transaction is not subject to a financing condition.
The transaction is expected to close in the second half of 2022, subject to the satisfaction of customary closing conditions, including regulatory approvals and approval by CMC Materials shareholders.
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