Ropes, Weil Steer $1.15 Billion Semiconductor Materials Deal

, The Am Law Daily

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Entegris said Tuesday it has agreed to buy ATMI, a rival supplier of materials to the semiconductor industry, in a deal worth $1.15 billion.

Am Law 100 firms Ropes & Gray and Weil, Gotshal & Manges landed the lead roles on the transaction, with the former advising Entegris and Weil taking the reins for ATMI.

The deal calls for Entegris to pay $34 in cash for each share of Danbury, Conn.–based ATMI, a price that represents a premium of 26.3 percent over the target's Monday closing price. Entegris, which has its headquarters in Billerica, Mass., added that the deal is valued at roughly $850 million when the cash acquired from ATMI in the deal is taken into account, including net proceeds from the recent $170 million sale of ATMI's life sciences unit to Pall Corporation.

The ATMI deal, which is expected to be completed in the second quarter of this year, is subject to the approval of regulators as well as ATMI shareholders. The transaction is also subject to the closing of the deal between ATMI and Pall, which was announced in December and is expected to close sometime this quarter. Once it is completed, Entegris expects the acquisition of ATMI to result in annual savings of roughly $30 million.

Bloomberg notes that a drop in demand for some of the materials ATMI sells to companies that produce semiconductor chips led the company to hire Barclays Capital in November to seek out strategic opportunities for the company. The subsequent sale is the latest example of consolidation among suppliers of semiconductor materials as a downturn in the chipmaking industry has resulted in fewer orders being sent out to suppliers. Other transactions include September's $29 billion combination of Applied Materials—the world's largest supplier of semiconductor materials—with Japan's Tokyo Electron. That deal followed another, announced in August, in which Sweden's Atlas Copco agreed to pay up to $1.6 billion to acquire Edwards Group, which makes industrial vacuums used in the chipmaking process.

The uptick in consolidation has meant an increased workload for Weil, which advised Applied Materials on its acquisition of Tokyo Electron after serving as cocounsel (along with Davis Polk & Wardwell) to Edwards on its sale to Atlas. The firm landed the role advising ATMI on its sale to Entegris after recently taking the lead for the former on the agreement to divest its life sciences unit to Pall.

The Weil team advising on Tuesday's deal includes New York–based corporate partners Thomas Roberts and Matthew Gilroy. Also advising are: tax partner Mark Hoenig, employee benefits partner Paul Wessel, technology and IP transactions partner John Brockland, environmental law partner Annemargaret Connolly, finance partner Richard Ginsburg and antitrust counsel Vadim Brusser. Weil associates on the deal are Adrienne Baker, Daniel Birnhak, Mark Dundon, Thomas Goslin, Clinton Hutchings, Renee Pristas, Faraz Rana and Jennifer Waisberg. Jakob Deitch and Jesse Sacks—Weil associates who have not yet been admitted to the bar—are also working on the deal. ATMI's chief legal officer is Patrick Shima.

Ropes corporate partner Craig Marcus is leading a team from that firm advising Entegris on the acquisition. Debt finance partner Thomas Draper, tax partner Eric Elfman, executive compensation partner Renata Ferrari, environmental law partner Peter Alpert and government enforcement partner James Dowden are also working on the deal. Peter Walcott serves as general counsel for Entegris.

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