ASML to Buy 24.9% Stake in Carl Zeiss SMT for EUR1 Billion in Cash

By Maarten van Tartwijk

AMSTERDAM--ASML Holding NV (ASML.AE) said Thursday it will invest 1 billion euros ($1.1 billion) in a German manufacturer of optical systems as it continues to develop its latest chip-making machines into the next decade.

The investment in Carl Zeiss SMT, in which ASML will take a 24.9% stake, is meant to facilitate the development of future extreme ultraviolet lithography, or EUV, systems, ASML said in a news release.

Chief Executive Peter Wennink said the partnership would create the right conditions to make the machines more sophisticated just as the first chips made by the technology are expected to roll off production lines in 2018.

"We see a long and successful future for EUV lithography in advanced chip manufacturing," he said. The investment could allow "our customers reap the rewards of their EUV investments up to the end of the next decade," he added.

ASML will invest around EUR220 million to support Carl Zeiss's research and development activities, while it has also committed EUR540 million in capital expenditure and other investments for the next six years. In light of the investment, ASML said it would prolong the suspension of its share buyback program for the time being.

Write to Maarten van Tartwijk at [e-mail]

(END) Dow Jones Newswires

November 03, 2016 04:15 ET (08:15 GMT)

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