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CFIUS Clearance: Yageo Corporation and Kemet Corporation

Status:  Clearance

Acquirer:  Yageo Corporation (Taiwan)

Acquired:  Kemet Corporation (US)

Value:  Approx. US$1.8 billion

Industry:  Electronic Manufacturing

On November 11, 2019, KEMET Corporation, a US publicly traded (NYSE: KEM) manufacturer of electronic components (capacitors, sensors, actuators, electromagnetic compatibility solutions, etc.) entered into a merger agreement with Yageo Corporation, a Taiwanese publicly traded (TAIEX: 2327) producer of electronic components (resistors, capacitors, wireless, circuit protection components, etc.) and its wholly owned subsidiary whereby the subsidiary will merge with and into the Kemet Corporation, with Kemet Corporation surviving as a wholly owned subsidiary of Yageo Corporation in an all-cash transaction valued at US $1.8 billion.  (See Kemet Corporation Form 8-K, Nov. 12, 2019, SEC Filing; Press Release, Kemet Corporation Form 8-K, Ex.99-1, Nov. 12, 2019, SEC Filing.) “Together with KEMET, Yageo will be well positioned as a one-stop provider of passive electronic components, including a leading portfolio of polymer, tantalum, ceramic, film and electrolytic capacitors, chip resistors, circuit protection as well as magnetics, sensors and actuators, all addressing a full range of end market segments.”  (Press Release, Kemet Corporation Form 8-K, Ex.99-1, Nov. 12, 2019, SEC Filing.)  CFIUS approval is a condition to closing the transaction.  (See Agreement and Plan of Merger, Section 6.3(d), 7(d), Kemet Corporation Form 8-K, Ex.2-1, Nov. 12, 2019, SEC Filing.  In a February 5, 2020 regulatory filing, Kemet Corporation reported that “[t]he parties’ filing with CFIUS was accepted on January 23, 2020 with the end of the initial forty-five (45) day review period scheduled to conclude on March 9, 2020.”  (Kemet Corporation Schedule 14A, Feb. 5, 2020, SEC Filing.)

© Copyright 2020 Squire Patton Boggs (US) LLPNational Law Review, Volume X, Number 38


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