8-KMaterial AgreementsOther Events

APPLIED MATERIALS INC /DE 8-K Report, Agreement Terminated (Jun 15, 2011)

Filed June 15, 2011For Securities:AMAT

Summary

Applied Materials, Inc. (AMAT) filed an 8-K on June 15, 2011, primarily to report on two key developments related to its proposed acquisition of Varian Semiconductor Equipment Associates, Inc. First, the company announced the termination of its $2 billion bridge loan facility. This termination was a direct result of the successful issuance and sale of senior unsecured notes totaling approximately $1.74 billion, which provided sufficient funding for the acquisition. Notably, no borrowings were made under the bridge loan. Second, Applied Materials disclosed that it received a request for additional information from the U.S. Department of Justice (DOJ) Antitrust Division regarding the Varian merger. This request, made under the Hart-Scott-Rodino Act, extends the regulatory waiting period, indicating that the merger is still under antitrust review. The company stated its intention to cooperate fully with the DOJ. These updates are critical for investors as they clarify the financing structure for the Varian acquisition and highlight a potential hurdle in the regulatory approval process. The termination of the bridge loan reduces financial obligations and associated risks, while the DOJ's request signals a more extended timeline for closing the deal, subject to antitrust clearance. Applied Materials provided details on where investors can find more information regarding the merger, including Varian's preliminary proxy statement and relevant filings with the SEC.

Key Highlights

  • 1Termination of $2 billion bridge loan facility due to successful senior unsecured notes issuance.
  • 2No borrowings were made under the terminated bridge loan agreement.
  • 3Applied Materials received a 'request for additional information' from the DOJ Antitrust Division regarding the Varian merger.
  • 4The DOJ request, under the HSR Act, extends the regulatory waiting period for the Varian acquisition.
  • 5Closing of the Varian merger remains subject to DOJ approval, among other conditions.
  • 6The company has filed and will continue to file solicitating material regarding the merger, directing investors to SEC filings and Varian's investor relations for more information.
  • 7The filing is classified as soliciting material under Rule 14a-12 of the Exchange Act.

Frequently Asked Questions

Applied Materials terminated the $2 billion bridge loan because it successfully raised approximately $1.74 billion through the issuance and sale of senior unsecured notes. This issuance provided sufficient funds for the planned acquisition of Varian Semiconductor Equipment Associates, Inc., making the bridge loan unnecessary. No funds were borrowed under the bridge loan facility.

The request for additional information from the DOJ Antitrust Division, made under the Hart-Scott-Rodino Antitrust Improvements Act, is a standard part of the regulatory review process for mergers. It effectively extends the waiting period for the merger's approval. Applied Materials expects to cooperate with the DOJ, but the closing of the merger is now contingent on obtaining antitrust approval, among other conditions.

No, the merger has not yet been approved. The DOJ's request for additional information indicates that the antitrust review is ongoing and has extended the regulatory waiting period. Other regulatory approvals and Varian's stockholder approval are also still required for the merger to close.

Investors can find more information on the SEC's website (www.sec.gov), Varian's preliminary proxy statement filed on June 7, 2011, and subsequent filings by both Varian and Applied Materials. Contacting Varian's Investor Relations department or visiting their corporate investor relations website are also recommended sources for information.