September 4, 2012 — Wafer probe card maker FormFactor, Livermore, CA, has agreed to acquire fellow probe card supplier MicroProbe, San Jose, CA, for $100M in cash and $16.8M in stock. The deal, subject to customary conditions, is expected to close by the end of this year.

MicroProbe generated $87.3M in revenue for its fiscal 2011 (ended Dec. 31), with 46% Y/Y growth and a non-GAAP EBITDA profit margin of 20%.

The combined entity will, according to the companies, be the industry-leading supplier of advanced system-on-chip (SOC) probe cards, with technology leadership in both memory and SOC probe card markets. The entity also will see "improved and immediately accretive financial performance" by the beginning of 2013, they claim.

FormFactor was unseated as the longtime top nonmemory probe card supplier in VLSI Research rankings earlier this year; it now ranks second with $162M in 2011 sales, with Microprobe listed fourth. Combined they would rival Japan’s Micronics ($242M) which assumed the top spot. VLSI projects probe card sales will be flat in 2012 but overall growing steadily over the next five years, reaching $1.5B by 2016.

"This merger is a transformational event for FormFactor," stated FormFactor CEO Tom St. Dennis. "The combined company will have the technology and resources to address semiconductor test requirements across the entire advanced probe card space."

"This merger enables our world-class teams to accelerate innovation in wafer test across our customer base and provides compelling opportunities for our combined employees," explained Mike Slessor, CEO of MicroProbe, who will become SVP and executive officer of the combined companies.

"Together, we are in position to focus on delivering leading wafer probe solutions to meet the needs and roadmaps of logic and memory semiconductor device manufacturers," added FormFactor chairman Carl Everett.