U.S. Tech Companies Are Planting Serious Roots In China

china etfsTony Sagami: Much of Wall Street is keeping its eyes glued to Washington for the newest developments in the newest budget showdown. Right now, many are waiting to see where they should put money to work in the markets next.

In the meantime, however, my readers saw a nice, roughly 50% jump in one of their positions last week in an intriguing opportunity in the tech sector.

Last week Applied Materials (NYSE:AMAT) surprised Wall Street and even many tech observers when it acquired Tokyo Electron. The price tag was $9.3 billion.

Tokyo Electron is the world’s third-largest chip equipment maker, but Applied Materials is no small fish itself. AMAT was already the No. 1 chip equipment maker — and one of the top technology companies on the planet.

The combination of the No. 1 and No. 3 chip equipment makers will create a behemoth that totally dominates this market segment.

Wall Street clearly loved the marriage. AMAT shares shot up 9% the day of the news.

The Applied Materials/Tokyo Electron marriage is big news, but AMAT announced something else last week that may be even more important.

CEO Gary Dickerson is moving, along with his wife and two children, from Silicon Valley to Tokyo.



That’s what I call committed.

The message is loud and clear. The global technology epicenter is shifting away from Silicon Valley and toward Asia.

Mark Pinto, the Chief Technology Officer of Applied Materials, moved from Silicon Valley to China in 2010. He oversees the company’s new research laboratory in Xi’an, China.

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