KLA-Tencor, Lam Research Shares Drop As Cos. Call Off Acquisition Deal

Lam Research Corp. and KLA-Tencor Corp. said late Wednesday they have scuttled a deal to combine companies, citing resistance from the Justice Department. Shares of KLA-Tencor fell 4.5% to $68 after hours, while shares of Lam declined 2.3% to $94. No merger-termination fees will be paid by either company, KLA-Tencor said in a statement. The companies said the deal wasn't in the best interest of shareholders after the Justice Department said it would not continue with a consent decree the companies had been negotiating. Back in May, the Justice Departmentrequested more information on the deal. The announcement comes nearly a year after Lam announced it planned to buy KLA-Tencor in a $10.6 billion cash-and-stock deal. The Justice Department already helped to squash a planned 2015 merger between Applied Materials Inc. and Tokyo Electron Ltd.