Yageo Takes Over Kemet

A New Heavyweight is Emerging

12. November 2019, 16:26 Uhr | Engelbert Hopf
Kemet CEO William M Lowe, Jr.
Kemet CEO William M Lowe, Jr. welcomes the acquisition, which provides the company's shareholders with the security of instant cash at a premium surcharge.
© Kemet

Yageo takes over Cash Kemet for $1.64 billion. According to Taiwanese press reports, the purchase price including the obligations to be assumed increases to around 1.8 billion dollars.

According to Yageo, the purchase price of 27.70 dollars per share is 26 percent above the average share value of the last 30 trading days. Kemet had achieved a turnover of 1.38 billion dollars in the financial year 2019 (ended 31 March). Turnover after the first half of the 2020 financial year was 672 million dollars as at 30 September 2019). The takeover creates a supplier of mainly passive components with a sales volume of around 3 billion dollars. Yageo is thus likely to move up into the top 5 in the industry, and to be positioned between TDK and Taiyo Yuden behind Murata and Samsung.

Kemet employs around 14,000 people worldwide, holds more than 1600 patents and has 23 production sites. Kemet mainly manufactures tantalum and ceramic capacitors as well as magnetic components, sensors and actuators, and film and electrolytic capacitors. Recently, the company has increasingly turned to the automotive segment. Following the acquisition, Yageo will have 14 R&D centers and 42 production facilities worldwide. Pierre Chen, Chairman and CEO of Yageo, stated that the objective of this acquisition is to develop Yageo into a one-stop-one-buy supplier of passive components. The acquisition is subject to regulatory approval.

The acquisition expands Yageo's standing in North America, Europe and Asia. The acquisition should also improve Yageo's standing in Japan, where Kemet has successfully expanded its business following the successful acquisition of Tokin. With the acquisition, Chen is above all striving for a better, long-term standing with blue chip customers in the future. Through this acquisition, Yageo will be able to leverage product-related, geographical and customer-oriented synergies. This applies in particular to the high-end segments of the automotive, industrial, aviation, telecommunications and medical technology sectors.

As William M. Lowe, Jr. CEO of Kemet, assures us, from the point of view of the Kemet Supervisory Board, the takeover is in the best interests of shareholders, customers and employees. In his words, the deal gives shareholders the security of "immediate cash with a premium surcharge“.

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YAGEO Europe BV, Yageo HOLDING B.V., KEMET Electronics GmbH