Veeco Instruments and FEI to merge

Veeco Instruments and FEI have signed a merger agreement that will create the sixth largest US semiconductor equipment company and the third largest US supplier of metrology equipment.

Veeco Instruments and FEI have signed a merger agreement that will create the sixth largest US semiconductor equipment company and the third largest US supplier of metrology equipment with combined 2001 sales of $825 million.

FEI will become a wholly owned subsidiary of Veeco, and Veeco will be renamed Veeco FEI.

Pursuant to the agreement, unanimously approved by the Boards of Directors of both companies, FEI stockholders will receive 1.355 shares of Veeco common stock for each share of FEI they own. Based upon FEI’s approximately 32 million diluted shares outstanding, the FEI stockholders will receive approximately 44 million Veeco FEI shares with a current value of approximately $1 billion.

The merger, which will be accounted for using the purchase method, is intended to be tax-free to FEI stockholders, and is expected to close during the fourth quarter of 2002 following approval of each company’s stockholders, certain regulatory approvals and other customary closing conditions.

Veeco FEI’s corporate headquarters will be located in Woodbury, NY, the current Veeco headquarters, and FEI’s current headquarters in Hillsboro, OR will remain a facility for Veeco FEI as a centre of research, development and manufacturing. Veeco FEI will have approximately 2,900 employees at its key facilities in North America, Europe, Japan and the Asia-Pacific region.

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