ASML Holding Jumps as Intel Takes Stake
ASML Holding (NASDAQ: ASML) announced on Monday after the closing bell that chip giant Intel (NASDAQ: INTC) has agreed to take a 15 percent stake in the company in order to help fund research in to new technologies. The company said that other large customers are also considering similar investments.
Intel will also make a cash contribution to help fund the project. The first phase of the program will consist of Intel committing to R&D funding of around $680 million. The equity investment will be worth an additional $2.1 billion, or approximately 10 percent, of ASML's pre-transaction issued shares.
The second phase of the initiative will be dependent upon ASML shareholder approval, and includes additional R&D funding from Intel of around $340 million and an approximate $1 billion equity investment, which equates to another 5 percent of the company. After the two separate phases are completed, Intel will hold a total of 15 percent of ASML's shares.
"Productivity improvements driven by enhanced wafer manufacturing technologies, especially larger silicon wafers and enhanced lithography technologies with EUV are direct enablers of Moore's Law, which delivers significant economic benefits to consumers," said Brian Krzanich, Intel senior vice president and chief operating officer, in a company release.
ASML shares jumped more than 7 percent to $51.94 in Monday's after hours session in the news. Intel lost a little more than 1 percent, closing the session at $25.89.
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