8-KMaterial AgreementsExhibits & Filings

ENTEGRIS INC 8-K Report, Material Agreement (Dec 16, 2021)

Filed December 16, 2021For Securities:ENTG

Summary

Entegris Inc. (ENTG) has announced a significant definitive agreement to acquire CMC Materials, Inc. (CMC) through a merger. The transaction is structured as a stock and cash deal, where CMC shareholders will receive $133 in cash and 0.4506 shares of Entegris common stock for each share of CMC they hold. This strategic move aims to enhance Entegris's position in the materials science sector, particularly within the semiconductor industry. The financing for this acquisition is substantially secured through a commitment letter for bridge and term loan facilities totaling up to $4.895 billion. This funding will be used for the cash portion of the merger consideration, fees, expenses, and refinancing of existing debt for both companies. The completion of the merger is contingent upon customary closing conditions, including regulatory approvals (antitrust in several jurisdictions) and CMC stockholder approval, with a target completion date of December 14, 2022, subject to extensions for regulatory reasons.

Key Highlights

  • 1Entegris to acquire CMC Materials for a combination of cash and Entegris common stock.
  • 2CMC shareholders will receive $133 cash and 0.4506 shares of Entegris common stock per CMC share.
  • 3The acquisition is financed by a significant debt commitment package totaling $4.895 billion.
  • 4Proceeds from financing will cover cash consideration, fees, expenses, and debt refinancing.
  • 5Closing of the merger is subject to standard conditions including regulatory approvals (e.g., HSR, China, Korea, Japan, Singapore, Taiwan) and CMC stockholder approval.
  • 6The Merger Agreement includes provisions for termination fees, with CMC potentially paying $187 million under specific circumstances.
  • 7The transaction is expected to close by December 14, 2022, with a provision for a three-month extension for regulatory clearance.

Frequently Asked Questions

The filing does not explicitly state the total transaction value, but it details the merger consideration as $133 in cash and 0.4506 shares of Entegris common stock per CMC share. Investors will need to refer to future SEC filings, such as the Form S-4, for a precise valuation.

Entegris has secured a commitment for financing through Morgan Stanley Senior Funding, Inc. This includes a 364-day senior unsecured bridge term loan facility of up to $895 million and a senior secured first lien term loan B facility of up to $4 billion, totaling $4.895 billion.

Key conditions include the approval of the merger agreement by CMC stockholders, expiration or termination of waiting periods under antitrust laws (including Hart-Scott-Rodino and approvals in China, Korea, Japan, Singapore, and Taiwan), absence of any governmental orders prohibiting the merger, effectiveness of Entegris's Form S-4 registration statement, and listing of Entegris shares on NASDAQ.

Upon closing, outstanding CMC stock options will vest and convert into options for Entegris stock. Restricted shares and time-based restricted stock units will vest and be converted into the merger consideration. Performance-based restricted stock units will be converted into time-based restricted stock units for Entegris stock, based on target performance metrics.