Dutch chipmaking equipment firm ASML Holdings NV has agreed to buy Taiwanese peer Hermes Microvision Inc (HMI) for about T$100 billion ($3.1 billion) to strengthen their technology offering for semiconductor manufacturers. The transaction would be one of the biggest inbound acquisitions for Taiwan. It comes after Micron Technology said late last year that it planned to buy the remaining interest in its Taiwanese joint venture in a deal valued around $3.2 billion.

HMI is a leading supplier of pattern verification systems used for advanced semiconductor devices.

The two companies are already developing joint approaches that IC manufacturers can use to improve yields in the production of advanced microchips. The combination will allow ASML and HMI to further integrate and enhance their product offering at an accelerated pace.

"Our over-arching goal is to serve our customers even better and offer them the tools they need to achieve higher yields at the most advanced nodes. This acquisition is intended to make a strong product offering even stronger. Our metrology technologies are complementary, and when combined offer the chance to significantly improve process control, and hence yields, for our customers. Our two companies have worked together for almost two years to see how we could best combine our capabilities, and found that we could significantly improve this constructive cooperation and better serve our customer by teaming up as one company. This also means that we expect enhanced product offerings faster," said Peter Wennink, President and Chief Executive Officer at ASML.

The integrated offerings will address the challenges chip makers are facing as they enter sub-10 nanometer resolutions and 3D integration, requiring chip manufacturers to apply advanced process control. This requires very dense, high resolution metrology to measure and control device performance, whereas 3D integration requires very dense, high voltage contrast metrology for process control.

HMI has multiple years of e-beam application experience, focused on high resolution and voltage contrast imaging. HMI will continue to enhance these technologies and it will also boost ASML’s holistic lithographic portfolio of 1. lithography exposure systems, 2. computational lithography and 3. metrology.

Furthermore, HMI has pioneered e-beam inspection systems that are specially designed for mask manufacturers to identify pattern defects in Extreme Ultraviolet (EUV) resulting from the mask. This will support the ramp of ASML’s EUV platform, set to be used for volume production of semiconductors starting in 2018.

The transaction is expected to close in the fourth quarter of 2016.