According to a Reuters report, the acquisition of Tokyo Electron Ltd by Applied Materials was rare in a country wherein it would only opt to be bought out by its foreign rival as a last resort.
The completion of the USD10 billion, all-stock takeover would make it the biggest takeover of a Japan firm by a foreigner. Analysts thought that the move was an unnecessary deal for Tokyo Electron as the company's balance sheet was solid. However, the move was seen as a possible catalyst for local firms to replicate in the near future. In 2012, inbound deals only garnered USD15 billion as opposed to offshore acquisitions which worth a total of USD83 billion.
As part of Prime Minister Shinzo Abe three-prong strategy to revive the struggling national economy, investment bankers were placing their hopes on the Tokyo Electron deal to encourage other Japanese firms to be open on ceding control to foreign rivals.
However, Ken Siegel, managing partner at law firm Morrison & Foerster in Tokyo expected that this might take time. "You would expect this would lead to some strategic transactions as well. This is probably the first one. I don't see a tonne of other strategic inbound deals lined up right this minute."
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