• Extends KLA-Tencor’s technology and market reach within the electronics value chain
  • Expands KLA-Tencor’s addressable market by $2.5 billion in high-growth electronics end markets
  • Immediately accretive to revenue growth, non-GAAP earnings and free cash flow per share with approximately $50 million run-rate synergies
  • Announces $2 billion share repurchase authorization

MILPITAS, Calif., and YAVNE, Israel, March 19, 2018 – KLA-Tencor Corporation (NASDAQ: KLAC) (“KLA-Tencor”) and Orbotech Ltd. (“Orbotech”) today announced they had entered into a definitive agreement pursuant to which KLA-Tencor will acquire Orbotech Ltd. (“Orbotech”) for $38.86 in cash and 0.25 of a share of KLA-Tencor common stock in exchange for each ordinary share of Orbotech, implying a total consideration of approximately $69.02 per share. The transaction values Orbotech at an equity value of approximately $3.4 billion and an enterprise value of $3.2 billion. In addition, KLA-Tencor announced a $2 billion share repurchase authorization. The share repurchase program is targeted to be completed within 12 to 18 months following the close of this transaction.

With this acquisition, KLA-Tencor will significantly diversify its revenue base and add $2.5 billion of addressable market opportunity in the high-growth printed circuit board (“PCB”), flat panel display (“FPD”), packaging, and semiconductor manufacturing areas.  The broader portfolio of leading products, services, and solutions, as well as increased exposure to technology megatrends, will support KLA-Tencor’s long-term revenue and earnings growth targets.

This acquisition is consistent with our strategy to pursue sustained, profitable growth by expanding into adjacent markets,” commented Rick Wallace, President and Chief Executive Officer of KLA-Tencor. “This combination will open new market opportunities for KLA-Tencor, and expands our portfolio serving the semiconductor industry.” Mr. Wallace continued, “Our companies fit together exceptionally well in terms of people, processes, and technology. In addition, KLA-Tencor has had a strong presence in Israel over the years, and this combination further expands our operations in this important global technology region.”

“This acquisition is a true testament to Orbotech’s strong leadership and success,” said Asher Levy, Chief Executive Officer of Orbotech Ltd. “I firmly believe that this deal benefits our employees and creates additional value for our shareholders. Together with KLA-Tencor, we will significantly increase growth potential, accelerate our product development roadmap, and enhance customer offerings.”  Mr. Levy added, “Orbotech will continue to operate under the Orbotech brand as a standalone business of KLA-Tencor based in Yavne, Israel.

Total cost synergies are expected to be approximately $50 million on an annualized basis within 12 to 24 months following the closing of the transaction, and the transaction is expected to be immediately accretive to KLA-Tencor’s revenue growth model, non-GAAP earnings and free cash flow per share.

The transaction has been approved by the Board of Directors of each company and is expected to close by the fourth quarter of calendar year 2018, subject to approval by Orbotech’s shareholders, required regulatory approvals and the satisfaction of the other customary closing conditions. No approval by KLA-Tencor stockholders is required. The transaction is not subject to any financing conditionality. KLA-Tencor intends to fund the cash portion of the purchase price with cash from the combined company’s balance sheet. In addition, KLA-Tencor intends to raise approximately $1 billion in new long-term debt financing to complete the share repurchase.

J.P. Morgan acted as exclusive financial advisor to KLA-Tencor; Wilson Sonsini Goodrich & Rosati acted as KLA-Tencor’s U.S. legal counsel; and Meitar Liquornik Geva Lesham Tal acted as KLA-Tencor’s Israeli legal counsel.

Barclays acted as exclusive financial advisor to Orbotech, Cravath, Swaine & Moore LLP acted as Orbotech’s U.S. legal counsel, Tulchinsky Stern Marciano Cohen Levitski & Co. as Israeli legal counsel, Goldman Sachs acted as special advisor to Orbotech’s transaction committee.

About KLA-Tencor: KLA-Tencor Corporation, a leading provider of process control and yield management solutions, partners with customers around the world to develop state-of-the-art inspection and metrology technologies. These technologies serve the semiconductor and other related nanoelectronics industries. With a portfolio of industry-standard products and a team of world-class engineers and scientists, the company has created superior solutions for its customers for more than 40 years. Headquartered in Milpitas, Calif., KLA-Tencor has dedicated customer operations and service centers around the world. information may be found at www.kla-tencor.com. (KLAC-F)

About Orbotech: Orbotech is a leading global supplier of yield-enhancing and process-enabling solutions for the manufacture of electronics products. Orbotech provides cutting-edge solutions for use in the manufacture of printed circuit boards (PCBs), flat panel displays (FPDs), and semiconductor devices (SDs), designed to enable the production of innovative, next-generation electronic products and improve the cost effectiveness of existing and future electronics production processes.

Forward-Looking Statements

This press release contains forward-looking statements as defined in the Securities Exchange Act of 1934 and is subject to the safe harbors created therein. These forward-looking statements involve risks and uncertainties that could significantly affect the expected results and are based on certain key assumptions. Due to such uncertainties and risks, no assurances can be given that such expectations will prove to have been correct, and readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. The forward-looking statements contained herein include, but are not limited to, the manner in which the parties plan to effect the transaction, including the share repurchase program; the ability to raise additional capital necessary to complete the repurchase program within the time frame expected; the expected benefits, synergies and costs of the transaction; management plans relating to the transaction; the expected timing of the completion of the transaction; the parties’ ability to complete the transaction considering the various closing conditions, including conditions related to regulatory and Orbotech shareholder approvals; the plans, strategies and objectives of management for future operations; product development, product extensions, product integration, complementary product offerings and growth opportunities in certain business areas; the potential future financial impact of the transaction; and any assumptions underlying any of the foregoing. Actual results may differ materially from those referred to in the forward-looking statements due to a number of important factors, including but not limited to the possibility that expected benefits of the transaction may not materialize as expected; that the transaction may not be timely completed, if at all; that KLA-Tencor may not be able to successfully integrate the solutions and employees of the two companies or ensure the continued performance or growth of Orbotech’s products or solutions.

In addition, other risks that KLA-Tencor faces include those detailed in KLA-Tencor’s filings with the Securities and Exchange Commission, including KLA-Tencor’s annual report on Form 10-K for the year ended June 30, 2017 and quarterly report on Form 10-Q for the quarter ended December 31, 2017. Other risks that Orbotech faces include those detailed in Orbotech’s filings with the Securities and Exchange Commission, including Orbotech’s annual report on Form 20-F for the year ended December 31, 2017.

Additional Information and Where to Find It

This press release is being made in respect of a proposed business combination involving KLA-Tencor and Orbotech.  This press release does not constitute an offer to sell or the solicitation of an offer to buy or subscribe for any securities or a solicitation of any vote or approval nor shall there be any sale, issuance or transfer of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The proposed transaction will be submitted to the shareholders of Orbotech for their consideration. KLA-Tencor intends to file with the SEC a Registration Statement on Form S-4 that will include a preliminary prospectus with respect to KLA-Tencor’s common stock to be issued in the proposed transaction and a proxy statement of Orbotech in connection with the merger of an indirect subsidiary of KLA-Tencor with and into Orbotech, with Orbotech surviving.  The information in the preliminary proxy statement/prospectus is not complete and may be changed.  KLA-Tencor may not sell the common stock referenced in the proxy statement/prospectus until the Registration Statement on Form S-4 becomes effective.  The proxy statement/prospectus will be provided to the Orbotech shareholders.  KLA-Tencor and Orbotech also plan to file other documents with the SEC regarding the proposed transaction.

This press release is not a substitute for any prospectus, proxy statement or any other document that KLA-Tencor or Orbotech may file with the SEC in connection with the proposed transaction. Investors and security holders of KLA-Tencor and Orbotech are urged to read the proxy statement/prospectus and any other relevant documents that will be filed with the SEC carefully and in their entirety when they become available because they will contain important information about the proposed transaction.

You may obtain copies of all documents filed with the SEC regarding this transaction, free of charge, at the SEC’s website (www.sec.gov). In addition, investors and security holders will be able to obtain free copies of the proxy statement/prospectus (when they become available) and other documents filed with the SEC by KLA-Tencor on KLA-Tencor’s Investor Relations page (ir.kla-tencor.com) or by writing to KLA-Tencor Corporation, Investor Relations, 1 Technology Drive, Milpitas, CA 95035 (for documents filed with the SEC by KLA-Tencor), or by Orbotech on Orbotech’s Investor Relations page (investors.Orbotech.com) or by writing to Orbotech Ltd., Investor Relations, 7 Sanhedrin Boulevard, North Industrial Zone, Yavne 8110101 Israel (for documents filed with the SEC by Orbotech).

Conference Call and Webcast Details
KLA-Tencor will hold a conference call Monday, March 19 at 6:00 a.m. PT (9:00 a.m. ET) to discuss this announcement. The conference call can be joined by dialing 1-866-787-1003, Conference ID 5679896, within the U.S. and 1-678-276-8164, Conference ID 5679896, for all other locations. To access the webcast, visit the Investor Relations section of KLA-Tencor web site at http://www.kla-tencor.com and click on the Events section to view the details. A webcast replay will be available on KLA-Tencor web site approximately three hours after the conference call concludes.

 

過去の情報を除いて、このウェブサイト(プレスリリース、ウェブキャスト、プレゼンテーション、投稿、およびその他の場所を含む)で議論されている事項は、1995年の米国民事訴訟改革法の意義の範囲内での将来の見通しに関する記述です。これらの記述は、特に、将来の見通し、開発、およびビジネス戦略に関連するものであり、特定のリスクや不確実性を伴います。仮定への言及も含めて、「~を予測する(anticipate)」、「~と信じる(believe)」、「~することができた(could)」、「~する予定である(will)」、「~を計画する(plan)」、「~に期待する(expect)」、および「~であろう(would)」などの用語および類似の用語やフレーズは、将来の見通しに関する記述を識別するために本ウェブサイトで使用されています。これらの見通しに関する記述は、該当する情報(プレスリリース、ウェブキャスト、プレゼンテーション、または投稿)の日付における将来のイベントに関する経営者の期待と信念に基づいており、オルボテックの事業運営およびビジネス環境に関連する不確実性や要因、以前に発表されたKLAによるオルボテックの買収、当事者が取引を達成しようとする方法(株式買戻しプログラムを含む)、想定される期間内に買戻しプログラムを完成させるために必要な増加資本を引き上げる能力、想定される利益、取引の相乗効果とコスト、取引に関連する管理計画、取引完了の想定時期、さまざまな決算条件を考慮して取引を完了する当事者の能力(規制当局およびオルボテックの株主承認に関連する条件を含む)、将来の運営に向けた経営陣の計画/戦略/目標、製品開発、製品の拡張、製品統合、特定事業分野における補完製品の提供および成長の機会、取引について将来予想される財務的な影響、および前述のいずれかの根拠となる前提条件に依存するものです。実際の結果は、多くの重要な要因によって、将来の見通しに関する記述とは大きく異なることがあります。これらの要因には、前述の事項や以下のように、想定される取引の利益が期待どおりに実現しないことがあります(ただし、これらに限定されません)。すなわち、取引がタイムリーに完了できないこと、KLA-Tencorが両社のソリューションと従業員をうまく統合できないことあるいはオルボテックの製品やソリューションの継続的な業績や成長を保証できないこと、当社が2018年に2018年の収益とマージンの期待値を達成できないこと(開始日付の変更を無制限に含む)、当社が事業を行う業界における景気の循環性、当社のサプライチェーン管理と生産の能力、注文のキャンセル(ほとんどの場合においてペナルティなし)、製品受け入れのタイミングと発生(当社は「予約」と「バックログ」を、相互に合意した条件に基づく顧客との購入手配と定義しています。これは、特定の予約とバックログについては、文書の記録の完了に依存する場合があるため、顧客によって変更または取り消されることがあり、ほとんどの場合、ペナルティはありません)、部門内および部門間の製品構成の変動、一般的な世界経済の状況(特に当社が事業を運営する業界での状況)、当社および競合他社による製品とサービスの提供のタイミングと強み、事業または価格戦略の変更、当事者が事業を行っている現行の政治と規制の枠組みの変化(英国のEU(欧州連合)からの将来の撤退(Brexitと呼ばれる)や米国の政治的不確実性の結果としての変化を含む)、あるいは経済的または技術的な動向または条件の変化(世界的、地域的、または国家的な観点に基づいた通貨変動、インフレ、および消費者の信頼感など)、スマートモバイルデバイス、自動車エレクトロニクス、フレキシブルなアプリケーションとデバイス、拡張現実感/バーチャルリアリティとウェアラブルデバイス、高性能コンピューティング、液晶ディスプレイ、有機発光ダイオード画面などの高機能デバイスに対する消費者の要望のレベル、当社の世界的活動およびさまざまな法律、規制、取引所、税および税体制、税務監査の時期と結果(イスラエルにおける2012~2014税務年度の監査に関するイスラエル税務当局によって発行された最善の判断による税評価および関連する犯罪捜査を含む)、戦略的イニシアチブを達成する当社の能力(買収戦略を含む)、当社の債務および企業財務活動、韓国における刑事事件のタイミング/最終結果/影響および継続的な調査(韓国等における現存または将来のビジネス機会への影響を含む)、当社の顧客を含む第三者からもたらされる韓国問題に関連する民事訴訟(これによって金銭的な判断や和解、韓国問題に伴う費用、イスラエルや周辺地域での敵対行為の継続または増大をもたらす可能性があります)。

上記の情報は、2017年12月31日に終了した事業年度の当社の年次報告書20-Fおよびその後のSEC提出書類と併せて読む必要があります。この情報は、このウェブサイト上の該当する文書(プレスリリース、ウェブキャスト、プレゼンテーション、投稿、およびその他の文書)の情報によっても補完されます。当社は、上記、およびこれらの報告書に詳述されているその他のリスクに従うものとします。当社は、法律で要求されている場合を除き、本ウェブサイトの情報(プレスリリース、ウェブキャスト、プレゼンテーション、投稿、その他の場所を含む)を、新しい情報や将来のイベントを反映するように更新する義務はないものとします。