Rudolph Technologies (RTEC) - Get Report and August Technology (AUGT) have taken their merger case to the industry's largest trade show in a bid to convince customers that their deal would be superior and beneficial to any alternatives, specifically KLA-Tencor's (KLAC) - Get Report competing bid for August.
Rudolph and August agreed to merge two weeks ago in a stock swap that valued August at $10.50 a share, even though August shares have traded above $10.50 since February, when KLA-Tencor offered to buy August for $11.50 a share in cash.
On Tuesday, the official start of Semicon West, a three-day trade show in San Francisco for chip-equipment companies, August and Rudolph distributed new marketing materials identifying the advantages of their combination and presented some new reasons for the deal. The companies also filed the materials with the
Securities and Exchange Commission
August cited data from investment bank Needham that identified a 20-percentage-point cost disadvantage that small-cap equipment companies currently have vs.
, the world's largest equipment company, and KLA-Tencor, the world's seventh-largest company. August says a combination with Rudolph would close that gap by increasing its scale.
According to other data cited from Gartner, August and Rudolph would combine to be the fourth-largest inspection/metrology company, trailing KLA-Tencor,
in second, and Applied Materials. Rudolph currently ranks seventh, and August is 16th.
Most of the other data cited in August's 29-slide PowerPoint presentation had been used previously in other presentations; it cited expected operating cost savings of $10 million and the ability to leverage the two companies' complementary technologies.
Rudolph provided a two-page update for its customers, focusing on its new technology products and the opportunity for expansion presented by a combination with August.
Since Rudolph and August announced their deal, August shares have hovered around $12, indicating that investors are still expecting August to be bought at
higher prices than have currently been discussed.
For its part, KLA-Tencor has only said it remains interested in buying August and that it is prepared to be
patient in order to make that happen. However, more could be said Wednesday afternoon when KLA-Tencor executives host their own analyst and investor presentation.