Veeco Instruments Surges 7.5% on $4.4B Merger with Axcelis
All-stock deal aims to create a diversified semiconductor equipment leader, though Axcelis shares dip on the news.
Veeco Instruments (VECO) shares surged more than 7% after the company announced a definitive agreement to merge with Axcelis Technologies (ACLS) in a $4.4 billion all-stock transaction. The deal, intended to form a larger and more diversified semiconductor equipment supplier, prompted a divergent reaction from investors, with shares of Axcelis falling 3.4%.
The proposed combination aims to create the fourth-largest wafer fabrication equipment supplier in the United States, capitalizing on rising demand from high-growth sectors like artificial intelligence and power devices. , the companies stated the merger would broaden their total addressable market to over $5 billion.
Under the terms of the agreement, Veeco shareholders will receive 0.3575 Axcelis shares for each Veeco share they hold. Upon closing, Axcelis shareholders are expected to own approximately 58% of the combined entity, with Veeco shareholders holding the remaining 42%. The new company will be led by current Axcelis CEO Russell Low, with Veeco CEO Bill Miller set to join the board.
Analysts noted the strategic potential of the deal, despite the mixed initial market response. DA Davidson analyst Thomas Diffely highlighted that the merger increases the new company's exposure to several high-growth markets and strengthens its competitive position against larger industry players. The companies anticipate achieving within two years of the deal's closing.
However, the decline in Axcelis's stock suggests and integration risks. The transaction is expected to be finalized in the second half of 2026, pending customary closing conditions, including approvals from shareholders of both companies and regulatory bodies in the U.S. and China.