Mks Inc. · NASDAQ:MKSI
Mks — MKS Instruments — Merger or Acquisition (July 2021)
22 slides from Mks's merger presentation, Jul 1, 2021
Slide 1: Optimizing the Interconnect: MKS To Acquire Atotech
Exhibit 99.2 Optimizing the Interconnect: The Next Frontier For Miniaturization & Complexity July 1, 2021 MKS To Acquire AtotechExhibit 99.2 Optimizing the Interconnect: The Next Frontier For Miniaturization & Complexity July 1, 2021 MKS To Acquire Atotech
Slide 2: Safe Harbor for Forward-Looking Statements
Safe Harbor for Forward-Looking Statements Statements in this presentation regarding the proposed transaction (the “transaction”) between MKS Instruments, Inc. (“MKS”) and Atotech Limited (“Atotech”), the expected timetable for completing the transaction, future financial and operating results and m
Slide 3: Additional Information; No Offer or Solicitation
Additional Information; No Offer or Solicitation Additional Information and Where to Find It This communication does not constitute a solicitation of any vote or approval. In connection with the proposed transaction, Atotech plans to provide to its shareholders a circular containing information on t
Slide 4: Financial Information; Use of Non-GAAP Financial Measures
Financial Information; Use of Non-GAAP Financial Measures Financial Information; Presentation of Combined Information Except as otherwise indicated, all financial information of MKS has been reported in accordance with U.S. generally accepted accounting principles (“GAAP”) and all financial informat
Slide 5: Chemistry Is Critical Enabler in the Markets MKS Serves
Chemistry Is Critical Enabler in the Markets MKS Serves Semiconductor Advanced Markets MINIATURIZATION / FORM-FACTOR MINIATURIZATION Smaller Geometries (nm) Finer Features (µm) COMPLEXITY Vertical Scaling Higher Density CHEMISTRY CHEMISTRY CHEMISTRY Novel Materials Novel Materials Nov Novel el Ma Ma
Slide 6: Atotech: A Leading Chemistry Solutions Provider
Atotech: A Leading Chemistry Solutions Provider Specialty chemicals, equipment, software and services for printed circuit boards, semiconductor IC packaging, and surface finishing Electronics 2020 2020 2020 ● PCBs, semiconductor IC packaging Revenue Mix Revenue Stream Revenue By End Market ● Equipme
Slide 7: Challenges at the Interconnect Demand Integrated Approach
Challenges at the Interconnect Demand Integrated Approach Combined PCB Expertise Unique to Industry ● Increased device complexity driving PCB and Packaging innovation ‒ Increasing density, shrinking geometries ● Interconnect quality is essential to integration of chips to devices ‒ Reliability, prod
Slide 8: Complete Via Formation Process – Unique to the Industry
Complete Via Formation Process – Unique to the Industry VIA FORMATION PRESSING Optimize laser absorption for & PLATING G Oe p W W o td iorld orld m e:i z m e - - class class a pro ke stt- 's Cu Cu d m rillpla pla o c slte ting ting a ad nv in afor for g n c fo ed r LAMINATION PHOTO quality & product
Slide 9: Complete Via Formation Workflow – Unique to the Industry
Complete Via Formation Workflow – Unique to the Industry PRESSING LAMINATION PHOTO PROCESS PROCESS FLOW VIA FORMATION & PLATING 9Complete Via Formation Workflow – Unique to the Industry PRESSING LAMINATION PHOTO PROCESS PROCESS FLOW VIA FORMATION & PLATING 9
Slide 10: Unique Domain Expertise In PCB and Packaging
Unique Domain Expertise In PCB and Packaging …. Wafer RDL IC Packaging Advanced PCB (HDI, Flex, SLP) MKS LASER SYSTEMS Multilayer PCB ATOTECH EQUIPMENT & MATERIALS LARGER VIA SIZE SMALLER Ability to optimize chemistry and equipment together will be a key differentiator 10 LOW COMPLEXITY LEVEL HIGHUn
Slide 11: Creates Attractive Share Gain Opportunity
…. Creates Attractive Share Gain Opportunity PCB Laser Drilling + Chemical Processing SAM MKS + Atotech MKS + ATOTECH PCB LASER DRILLING + CHEMICAL PROCESSING SAM [1] MKS internal estimates [1] ~$4B (2020) [2] MKS internal estimates. Refers to 2021-2025 CAGR [2] Share Gain Opportunity in Combined SA
Slide 12: L-T Opportunity: Leverage Combined Via Formation Expertise
L-T Opportunity: Leverage Combined Via Formation Expertise TODAY FUTURE Cross-Selling Opportunities Integrated via Formation Architectures Atotech leadership in ATOTECH HDI chemistry Growing miniaturization and complexity driving the need for optimization at the interconnect Deliver faster solutions
Slide 13: Transaction Financial Overview
Transaction Financial OverviewTransaction Financial Overview
Slide 14: Stronger Financial Profile
Stronger Financial Profile ● Atotech brings robust operating profile [1] ‒ Adjusted Gross margin >50% ; Adjusted EBITDA margin [1] of >25% ● Attractive recurring consumables revenue stream ‒ Equipment + Consumables provides sticky/stable business ● Non-GAAP EPS expected to be accretive within first
Slide 15: Stable Revenue Stream With Strong Profitability
Stable Revenue Stream With Strong Profitability [1] [2] MKS Atotech PRO FORMA Revenue $2.5B Revenue $1.3B Revenue $3.8B Consumables Service Consumables Services Services Equipment Equipment Equipment Non-GAAP GM 46% Adjusted GM 52% Non-GAAP GM 48% [3] Adjusted EBITDA $683M Adjusted EBITDA $336M Adju
Slide 16: Manageable Leverage With Strong Cash Generation Profile
Manageable Leverage With Strong Cash Generation Profile • Robust pro forma Free Cash Flow profile • No significant debt maturities expected for 5 years Pro Forma Capitalization • Strong track record of de-levering Cash $800M Revolver ($500M) $-- Gross Debt $5.3B Net Debt $4.5B [1] Expected Debt / Ad
Slide 17: Transaction Summary
Transaction Summary Per Share Consideration • $16.20 per share in cash and 0.0552 MKS shares per Atotech share • Equity value of $5.1B and estimated enterprise value of $6.5B Transaction Consideration • Estimated $50M within 18 - 36 months Synergies and EPS Impact • Expected to be accretive to Non-G
Slide 18: Uniquely Positioned to Optimize the Interconnect
Uniquely Positioned to Optimize the Interconnect ● Devices are getting smaller and more complex ‒ Next frontier in advanced electronics is optimizing the interconnect ● Combined company positioned to drive the next-gen advanced electronics roadmaps ‒ Expertise in lasers, optics, motion and chemistry
Slide 19: Q&A
Q&AQ&A
Slide 20: Appendix: GAAP to Non-GAAP Reconciliations
Appendix: GAAP to Non-GAAP ReconciliationsAppendix: GAAP to Non-GAAP Reconciliations
Slide 21: Financial Reconciliations – Twelve Months Ending December 31, 2020
Financial Reconciliations For the twelve month period ending December 31, 2020 (in million USD) Atotech Revenue $ 1,234 Atotech Reported gross profit $ 676 1 Depreciation expense and logistics costs (18) Adjusted gross profit $ 658 Adjusted gross margin 53% Atotech Net income (loss) $ (289) Interest
Slide 22: Financial Reconciliations – Twelve Months Ending March 31, 2021
Financial Reconciliations For the twelve month period ending March 31, 2021 (in million USD) Pro Forma Photon Pro Forma Combined MKS Control MKS Atotech Company Revenue $ 2,488 $ 52 $ 2,540 $ 1,305 $ 3 ,845 Pro Forma Photon Pro Forma Combined MKS Control MKS Atotech Company Reported gross profit $ 1