How UMS could benefit from Applied Materials’ acquisition

It could be the only Singapore proxy to gain from this.

According to OSK, Applied Materials (AMAT)’s acquisition of Tokyo Electron Ltd will make it a dominant player in the chip equipment manufacturing space.

Currently, UMS is a key supplier to AMAT, with its strength residing in its wafer handling platform, helping AMAT with the assembly of the latter’s Endura system.

While OSK does not expect UMS to immediately gain from this, it sees it as the sole Singapore proxy to ride on this landscape-changing event.

Here's more from OSK: 

Gartners ranks AMAT and TEL No.1 and No.3 respectively in the semiconductor manufacturing equipment industry in terms of worldwide market share last year.

The combined entity boasts a worldwide market share of 26%, twice that of its second largest competitor, ASML. The consolidation will, in turn, benefit AMAT’s key suppliers which now will have an expanded customer base to work on.