Applied Materials Inc.’s plan to buy Kalispell-based Semitool Inc. for $364 million was hailed Tuesday by both companies as a collaborative move that will allow Applied to broaden its range of products and take advantage of a global recovery in the semiconductor industry.

“As part of Applied Materials, we can accelerate the global adoption of the technologies Semitool has developed,” Semitool founder and chairman Ray Thompson said in a prepared statement.

“With this agreement we are providing our employees with a strong future and our stockholders with exceptional value.”

In the acquisition expected to be finalized by the end of the year, Semitool will become a business unit of Applied Materials, Semitool attorney Richard Hegger said.

Details about how Semitool employees’ futures will play out in the deal have not yet been disclosed, but Hegger said Semitool looks at the buyout “as a very positive development” that will combine the strengths of both companies.

“It’s anticipated they [Applied] will maximize the strengths of our manufacturing ability,” Hegger said.

Applied Materials, based in Santa Clara, Calif., and Semitool once were competitors in the manufacturing of wafer processing equipment for the semiconductor industry, but now the products offered by the two companies complement each other, Hegger said.

Randhir Thakur, senior vice president and general manager of Applied’s Silicon Systems Group, said the two companies “have a strong track record of collaborating to develop equipment solutions for leading chip makers.

“Together with Semitool’s people and products, we can help the industry move to smaller form factors and faster, lower power chips,” Thakur said in a press release.

Mike Splinter, chairman and chief executive officer of Applied Materials, said the semiconductor industry recovery is being fueled by global demand for mobile devices such as smart phones, notebook personal computers and portable media players.

A group of Applied Materials executives was at Semitool’s Kalispell facility on Tuesday to talk to employees about an integration process that will take several months, Hegger said.

Semitool employs 825 people worldwide, with 550 of those employees based at three facilities in the Libby and Kalispell areas, including the firm’s headquarters on West Reserve Drive.

The caliber of the Flathead Valley work force was a drawing card for Thompson when he started Semitool here 30 years ago.

He wanted to find good employees and considered Montana the best place to do it, even though his peers in the industry thought he was nuts to start a tech company in such a remote area, he said in an earlier interview with the Daily Inter Lake.

Industry peaks and valleys have prompted fairly routine layoffs and rehirings through the years. Lagging customer orders and a sluggish global economy late last year forced Semitool to furlough much of its work force for three weeks over the Christmas and New Year holidays.

Late last year and early this year Semitool eliminated 300 local jobs.

Montana West Economic Development intends to take an immediate role in reaching out to Applied Materials to promote the Flathead Valley’s business assets, Montana West President and CEO Kellie Danielson said.

“We believe that Applied will find opportunities in the Flathead because of the talent here,” Danielson said. “We want them to know the benefits of the opportunities here and the support they’ll get from us. As soon as the dust settles we [and state economic development officials] will be doing some outreach, engaging with them, so they see how important Semitool is to the Flathead and Montana.”

APPLIED’s all-cash offer to buy Semitool works out to $11 a share, a 31 percent premium above Semitool’s Monday closing share price of $8.40. Semitool shares increased to $11.02 in trading on Tuesday, while Applied’s stock dropped slightly to $12.94 per share.

For the deal to be approved, Applied Materials needs two-thirds of Semitool shareholders to accept the offer, which the companies expect to close by the end of the year.

About 32 percent of Semitool’s shares are held by its directors and executives, who already have agreed to the sale.

Applied Materials last week announced solid fourth-quarter results, with net sales of $1.53 billion and net income of $138 million. For the fiscal year ending Oct. 25, the company reported net sales of $5 billion and a net loss of $305 million.

Semitool’s fourth-quarter revenue was $47.1 million, compared to $31.8 million in this year’s third quarter and $60.1 million in the fourth quarter last year. Fourth-quarter bookings were $71.7 million, up 120 percent from the third quarter, and up 102 percent over the fourth quarter a year ago.

“The fourth quarter represented our strongest equipment bookings period in more than three years, and was the third-best quarter in Semitool history,” said Larry Murphy, president and chief operating officer.

For the full fiscal year, revenue was $139 million versus revenue of $238.6 million in fiscal 2008. Net loss was $11.4 million, versus net income of $6 million last year.

 Features editor Lynnette Hintze may be reached at 758-4421 or by e-mail at lhintze@dailyinterlake.com