Taipei, The Investment Commission said Tuesday it has approved an application from Taiwan’s largest passive electronics component maker Yageo Corp. to acquire U.S. rival Kemet Corp. for US$1.64 billion.
In response, Yageo said the commission’s approval is expected to accelerate the completion of the acquisition, which was announced in November 2019, and anticipated it will include Kemet’s sales and earnings on its books in July at the earliest.
Earlier this year, Yageo, which produces components such as chip resistors, inductors and multi-layer ceramic capacitors (MLCC), said the deal was scheduled to be completed in the third quarter after the company secured necessary approvals from antitrust authorities in Austria, Germany, Taiwan, the United States and China.
In a statement, the commission under the Ministry of Economic Affairs said Kemet specializes in passive components used in a wide range of industries such as automotive electronics, industrial applications, aviation, medical care, smartphones, cloud-based Internet communications, 5G gadgets and wireless communications.
The deal is expected to help Yageo extend its reach in the global market by strengthening the company’s high-end technologies and enabling it to enter a niche market, the commission said.
After the acquisition, Yageo has said it expects to see sales double and its profits increase by about 80 percent, which will consolidate its position as the third largest MLCC company in the world and solidify its share of the automotive electronics market.
Kemet has a workforce of 14,000 at 23 plants in 22 countries across Europe, Asia and in the U.S., according to Yageo, which has adopted a strategy of seeking growth through acquisitions.
In 2018, Yageo acquired another American company, Pulse Electronics Corp., for NT$22 billion (US$736 million.)
Source: Focus Taiwan News Channel