Yageo announced on Thursday that it has received a notice from China's anti-monopoly bureau that it has formally approved the merger of China giant and KEMET.
On November 12, 2019, Yageo announced that it would acquire Kemet USA for $1.8 billion. According to the agreement, Yageo will acquire all outstanding common shares of Kemet for $27.2 per share in cash. The transaction value is about $1.64 billion.
It is understood that the acquisition of the two sides of the transaction are internationally known manufacturers of passive components, the two products include MLCC, aluminum capacitors, inductors, resistors, tantalum capacitors and thin film capacitor products, among which the two overlapping products are MLCC, aluminum capacitors and inductors.Therefore, upon completion of the acquisition, Yageo can absorb Kemet into the field of tantalum capacitors and thin film capacitors.
"Kemet will be an important growth driver for kgi in the next 5-10 years."Chen taiming, chairman of Yageo, pointed out that there are several reasons for the acquisition of Kemet. First, Kemet's tantalum capacitors have the largest market share in the world, and the profitability of tantalum capacitors alone is the same as that of Yageo
"Everyone wants to get into cars, into engineering," Chen said. "that's what Yageo is aiming for. To grow, in addition to its own organic growth, m&a is also key.Chen stressed that everyone sees passive components as a cyclical industry, but the acquisition of Kemet will be the key to China giant's move into the high-end market.
The deal is expected to close in the third quarter of 2020 after the parties complete their preparations.Upon completion of the transaction, Kemet will become a wholly owned subsidiary of Yageo.
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